Barton and Statler are neighbors in an apartment complex in downtown Manhattan. Barton...
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Barton and Statler are neighbors in an apartment complex in downtown Manhattan. Barton is a concert pianist, and Statler is a poet working on an epic poem. Barton rehearses his concert pieces on the baby grand piano in his front room, which is directly above Statler's study. The following matrix shows the monthly payoffs to Barton and Statler when Barton's front room is and is not soundproofed. The soundproofing will be effective only if it is installed in Barton's apartment. (LO2) Assume that Statler has the legal right to peace and quiet and CAN negotiate with Barton at no cost. Which of the following statements is/are true? Barton will install soundproofing at a cost of $50. Barton will pay Statler at least $40 and at most $50 to be allowed to make noise. The negotiated equilibrium (with no soundproofing) will be socially efficient. If they share the surplus equally, Barton should pay Statler $45
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