Karen’s cat causes Danny to Karen values her cat’s companion…
Karen’s cat causes Danny to Karen values her cat’s companionship at $300 per year. The cost to Danny of tissues and her allergy medication is $350 per year. Based on the Coase theorem, Karen should pay Danny $350 for tissues and allergy medication Danny should pay Karen $325 to give away her cat Danny should move to another location Karen should pay Danny $400 so that she may keep her cat