Refer to figure 4: An artisanal goat‑yoga studio operates out of a ground‑floor commercial unit in a mixed‑use building. Each yoga class generates profits for the studio, but the presence of goats creates unpleasant odors that drift into the residential unit above. As the number of classes increases, profits rise, but so do the odor‑related costs imposed on the upstairs resident. The figure below shows the marginal costs of additional yoga classes and the marginal external costs imposed on the resident. Society in this case is just the studio owner and the resident above. Refer to figure 4 above. Select the correct statement.单项选择题

A

Coase theorem requires uncertain property rights allowing negotiated outcomes to arise.

B

Coase theorem requires there being low to no transaction costs.

C

Coase theorem requires there being a large number of small, homogenous actors.

D

Coase theorem is held up as an example as to why we don't need government intervention as the market will always be able to solve external costs on its own.

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