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please explain which answer is correct and why Johnston Forest in Rhode Island has a cave that houses thousands of fruit bats. The bats reside
please explain which answer is correct and why
Johnston Forest in Rhode Island has a cave that houses thousands of fruit bats. The bats reside near the town of Johnston, where residents value the bats at $400,000, as a tourist attraction. Slightly further away, in the town of Foster, residents find the bats to be a nuisance because their droppings ruin the paint jobs on their cars. They value the removal of the bats at $500,000. Which of the following solutions is an example of the Coase Theorem? a. Foster pays Johnston $499,999 to remove the bats b. Johnston pays Foster $400,000 to compensate them for the ruined paint jobs c. Foster lobbies the governor to sign an executive order eliminating all bats in the state d. The state assembly imposes a "bat tax" to force Johnston to "consume" fewi@r bats Step by Step Solution
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