Problems and applications q6 darnell loves playing rock 'n' roll music at high volume. jacques loves opera and hates rock 'n' roll. unfortunately, they are next-door neighbors in an apartment building with paper-thin walls. in this case, darnell imposes anegative externality on his neighbor in the form of noise pollution. why might a command-and-control policy that forbids music to be played above a certain decibel level lead to an inefficient outcome? it is unfair because such policy would restrict darnell's activity but not jacques's. an efficient outcome can only be achieved if everyone can do what they love. darnell playing his music loudly does not do any harm if jacques is not home. suppose the landlord lets the tenants do whatever they want. true or false: according to the coase theorem, darnell and jacques might not be able to reach an agreement if the transaction costs are high.

a. True

b. False