The Coase theorem can be applied to the question of free trade. Imagine there are a large number of producers and a small number

of consumers and that negotiation is easy. Producers are afraid of foreign competition. Under which of the following conditions will

free trade result?

a.the right to impose restrictions on the importation of foreign substitutes is awarded on producers

b.the right to be free of such restrictions is awarded to consumers

c.either of the above

d.none of the above