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      Question

      Employing a lawyer to draft and enforce a private

      contract between parties wishing to solve an externality problem is an example of a(n) ______________cost
      A opportunity Correct Answer Incorrect Answer
      B implicit Correct Answer Incorrect Answer
      C sunk Correct Answer Incorrect Answer
      D transaction Correct Answer Incorrect Answer
      E explicit Correct Answer Incorrect Answer

      Solution

      Transaction costs are expenses incurred when buying or selling a good or service.

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