What portion of total damages is compensatory

Reference no: EM131227492

Suppose that an injurer escapes liability in three out of four accidents that he causes. Let the average damages per accident be $100,000 and assume the liability rule is strict liability.

(a) In order for the injurer to face the correct incentives to take care, what should his total damages be in each case where he is held liable?

(b) What portion of total damages is compensatory and what portion is punitive?

Reference no: EM131227492

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