Why does private negotiation fail when many people benefit from an external advantage?

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Because the resource can be used by multiple people simultaneouslyDue to the issue of individuals benefiting without contributingAs explained by the Coase theoremBecause of incorrect reasoning about group outcomesNone of the above

Explanation

When a large group gains from an external benefit, private bargaining often fails because of the free-rider problem, where individuals enjoy the benefits without paying their share, reducing incentives to negotiate effectively.