i need help with these 7 questions .the answers should be correct and from the slides i'm attaching.
Econ 3060A Assignment 2
Due 10/13/2016 by 10:55am (Electronic submission in Blackboard is
1. A) What was the rationale behind enacting the Clean Air Act of 1970 at
the federal level, rather than allowing individual states to set air pollution
regulations? B) What are the major environmental policies regarding air
quality in the U.S.?
2. A) Define fund pollutants and stock pollutants with an example for each
type of pollutants. B) What are the main policy concerns for stock
pollutants? C) Identify the condition that determines the cost-effective
allocation of uniformly mixed fund pollutants across multiple sources.
3. A) Briefly describe the Kyoto Protocol. B) What are ways to improve the
effectiveness of this international agreement?
4. Read the paper ?The integration of water quality into transboundary
allocation agreements: lessons from the southwestern United States? by
Lynne Lewis Bennett, published in Agricultural Economics, Vol 24, 2000. A)
Use Figure 1 in the paper to explain why the efficient allocation requires
less water to the upper basin. B) What is the policy implication based on
Figure 1 5. A) Distinguish between static efficiency and dynamic efficiency. B) How
would the dynamically efficient allocation of scarce natural resources across
generations respond to changes in interest rates? Explain. 1 6. Suppose a city government is trying to determine how to deal with
pesticide contamination of its water supply. It decides to undertake a
benefit-cost analysis of two alternative policy options for controlling
- Upgrading its city water treatment plant to remove the pesticides, or
- Banning the use of the offending pesticide in the metropolitan area.
The costs of these control options are as follows:
- City treatment upgrades: Capital costs = $20 million. The new plant is
constructed over the course of the initial year. It starts operating at the end
of this year. Once the plant begins operation, it has operating costs of $1
million per year. One constructed, the plant lasts for five years, and then
must be replaced with a new plant.
- Pesticide ban: annual operating costs due to substitution of non-toxic
methods of controlling ?pests? = $3.5 million each year.
Let the discount rate be 5 percent. The city?s planning horizon is 10 years
(Year 0-Year 9). Suppose the PV of the benefits of the project are $40
million. Which project should the city prefer?
7. A) Identify possible biases associated with contingent evaluation method.
B) What are possible ways to eliminate those biases? 2
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