Externalities and the Coase Theorem: My neighbor never cuts his grass or cleans up his yard. Doing the work necessary to make the yard look nice would cause $400 of disutility for him. On the other hand, having to look at his messy yard causes me $600 in disutility. a. Suppose I have the right to require him to clean up his yard, though he can continue to have a messy yard if he pays me enough to get me to accept it. Will he pay me, or will he clean up his yard? Explain.
b. Suppose instead that he has the right to keep his yard as he wishes, but I can pay him to clean it up if I wish. Will I pay him enough to get him to clean up his yard? Explain.
c. Based on your answers to (a) and (b), does the final result (whether or not the yard gets cleaned up) depend on the definition of property rights (whether he has the right to a messy yard, or whether I have the right to require him to clean it up)? Explain. Does the definition of property rights affect the overall well-being of the two parties involved? (Am I better off in one case or the other? Is my neighbor better off in one case or the other?) Explain.

At a young age, ebony's coaches were confident she had the potential to be a world-class swimmer with a future coaching career. after four years on an athletic scholarship and olympic experience under her belt, she chose a different path. with her savings and personal connections, she rented a corner building in a bustling san francisco neighborhood and pursued her dream: a surf shop business. ebony's dream was rooted in which basic right of free-market capitalism?

Prior to its closing, income summary had total debits of $1,190,500 and total credits of $1,476,300. what purpose is served by the income summary account and what is the nature of the entries that resulted in the $1,190,500 and the $1,476,300? the income summary account is used to the accounts. the $1,190,500 represents the , and the $1,476,300 represents . the company had of $ .

The cost of capital: introduction the cost of capital: introduction companies issue bonds, preferred stock, and common equity to aise capital to invest in capital budgeting projects. capital is』necessary factor of production and like any other factor, it has a cost. this cost is equal to the select the applicable security. the rates of return that investors require on bonds, preferred stocks, and common equity represent the costs of those securities to the firm. companies estimate the required returns on their securities, calculate a weighted average of the costs of their different types of capital, and use this average cost for capital budgeting purposes. required return on rate: when calculating om operations when the firm's primary financial objective is to select shareholder value. to do this, companies invest in projects that earnselect their cost of capital. so, the cost of capital is often referred to as the -select -select and accruals, which a se spontaneously we hted average cost of capital wa c our concern is with capital that must be provided by select- 쑤 interest-bearing debt preferred stock and common equity. capital budgeting projects are undertaken, are not included as part of total invested capital because they do not come directly from investors. which of the following would be included in the caculation of total invested capital? choose the response that is most correct a. notes payable b. taxes payable c retained earnings d. responses a and c would be included in the calculation of total invested capital. e. none of the above would be included in the cakulation of total invested capital.