Question

QUESTION 7 Jason is a beekeeper. He keeps bees to produce honey and bees wax candles. Peter is a farmer whose farm is next to where Jason keeps his bees. Bees assist in pollinating crops. Which of the following statements are true: A private negotiation should not be hindered by negotiation costs if Jason and Peter can come to an agreement by just talking to one another. A private negotiation is hindered by the fact that it is unclear who has the property rights. A successful private negotiation should be possible where Peter values Jason keeping more bees, and the value to Peter is greater than the cost to Jason of acquiring more bees A private negotiation should internalise the external benefits from Jason's bees

Answer 1

A private negotiation should not be hindered by negotiation costs if Jason and Peter can come to an agreement by just talking to one another.

Because the motion of bees and and its effect on crops can not be controlled by any one of them.