A new supply-shifting policy of the state will have three direct effects in a specific river basin experiencing scarcity: • Supply will be shifted rightward for Upriver City; the net benefits of this shift to all of the city's water users has been estimated to be $5 million. The additional water use will result in the production of an added $2 million in output (market value). With a conservatively estimated multiplier of 2.3, secondary economic effects will amount to $4.6 million in the city. Supply will be shifted leftward for Downriver Irrigation District; the properly measured net "benefits" of this shift across all district irrigators is -$2 million. The value of farm output will be lowered by $1 million in the district. The secondary effects multiplier for the farm sector is 2.5. Between the city and the district is a river segment which will suffer some environmental degradation as a result of decreased flow. Some of these losses have been completely valued at $500,000. The remaining losses have not been valued. Is this a desirable policy for the river basin?

A new supply-shifting policy of the state will have three direct effects in a specific river basin experiencing scarcity: • Supply will be shifted rightward for Upriver City; the net benefits of this shift to all of the city's water users has been estimated to be $5 million. The additional water use will result in the production of an added $2 million in output (market value). With a conservatively estimated multiplier of 2.3, secondary economic effects will amount to $4.6 million in the city. Supply will be shifted leftward for Downriver Irrigation District; the properly measured net "benefits" of this shift across all district irrigators is -$2 million. The value of farm output will be lowered by $1 million in the district. The secondary effects multiplier for the farm sector is 2.5. Between the city and the district is a river segment which will suffer some environmental degradation as a result of decreased flow. Some of these losses have been completely valued at $500,000. The remaining losses have not been valued. Is this a desirable policy for the river basin?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

1. A local city council is considering a major transit expansion. The project requires purchases of $40 million in equipment now and annual expenses of $1 million each year starting in 2 years. The transit expansion is expected to reduce road congestion beginning next year and reduce respiratory illness in the region by 5% in 3 years. These benefits have been estimated monthly as 30 hours less time commuting. There are 250,000 commuters in the region and the average wage is $30 hour. Respiratory illness costs the local health system $500,000 each year. The council has asked you to complete a cost benefit analysis of the project. Present one with a time horizon of 5 years and another over the next 20 years. Current interest rates are 2% 2. Calculate the PV of $10 million received in 5 years 3. Suppose in a certain city the demand for low-cost housing can be characterized by the equation P = 200 - 2Q, where Q is housing measured in square feet. Further, suppose that supply is…
b) Discuss and explain the concept of positive return toscale showing it relationship with the quantity ofproduction.
(3 points) When sold for $259,000.00, Ferraris have an annual supply of 6758 vehicles and an annual demand of 6691 vehicles. When their price increases to $279,000.00, the annual supply increases to 6913, and the demand decreases to 6010 billion gallons. (a) Assuming that the supply and demand equations are linear, Afind the supply and demand equations. Supply Equation p = Demand Equationp (Note: The equations should be in the form p = mg + b where p denotes the price (in dollars) and q denotes the quantity. The slope and y-intercept should be accurate to two decimal places). (b) Find the Equilibrium price and quantity. Equilibrium price p = Equilibrium quantity q = (Note: The equilibrium price and quantity should be accurate to two decimal places, and the equilibrium price should include a dollar sign).
COURSE: MICROECONOMICS - TAX REGULATIONS The local diesel market is represented by Q = (912 - P)/12.5 and Q = (P - 315)/11where P is in dollars (USD) per liter of fuel and Q shows liters of fuel (in millions). Currently a tax of USD 130 per liter of diesel is charged.It is requested:(a) Calculate the amount (Q) that is transacted after the tax has been applied. Already solve few hours agob) Show in detail the calculations of a). Is there any difference between the price observed by suppliers and demanders? If so, what is the price observed by the producer and what is the price observed by the consumer? how much is the government's revenue? If there is an efficiency loss, how much is it? Already solve few hours agoc) At present, there are arguments in favor of increasing the tax on diesel and others in favor of decreasing it (at least temporarily). Mention at least ONE argument in favor of increasing this tax and ANOTHER argument in favor of decreasing it. And finally, conclude in…
COURSE: MICROECONOMICS - TAX REGULATIONS The local diesel market is represented by Q = (912 - P)/12.5 and Q = (P - 315)/11where P is in dollars (USD) per liter of fuel and Q shows liters of fuel (in millions). Currently a tax of USD 130 per liter of diesel is charged.It is requested:(a) Calculate the amount (Q) that is transacted after the tax has been applied.b) Show in detail the calculations of a). Is there any difference between the price observed by suppliers and demanders? If so, what is the price observed by the producer and what is the price observed by the consumer? how much is the government's revenue? If there is an efficiency loss, how much is it? GRAPHc) At present, there are arguments in favor of increasing the tax on diesel and others in favor of decreasing it (at least temporarily). Mention at least ONE argument in favor of increasing this tax and ANOTHER argument in favor of decreasing it. And finally, conclude in favor of which argument you are in favor of.
consignt 7. Suppose that an acre of wetland can sequester 100 tons of CO₂ and reduce the risk of itong would contribu 3 to 1 100,000 100,000 If CO2 causes $80 of present-value damage and the present-value VSL is $1.5 million per life, what is the value of the wetland's ecosystem services (per acre)? (Assume that the wetland has no non-use value or any other use value.) SE HOW a) $1,000,000 ble b) $1,500,080 transpki $3,008,000 im domons ost d There is not enough information to answer this question. flood-related deaths from
(1) Diagrammatically show and explain how oil prices dropped as concerns over fuel demand in the near term in COVID-19 pandemic hit Europe and the United States.
How would you best characterize which class of value a polar bear in the Arctic might represent to most people for purposes of environmental valuation? а. direct use value O b. property value Ос. O c. replacement cost value d. existence value
2. A municipal solid-waste site for a city must be located at Site A or SiteB. After sorting, some of the solid wastes will be transported to an electric power plant where it will be used as fuel. Data for the hauling of solid wastes from each site to the power plant are shown in Table below. Average hauling distance Yearly rental fee for solid - SITE A 4 kilometers P5,000 SITE B 3 kilometers P100,000 waste site Hauling Cost P1.50 per m - km P1.50 per m - I n° - km If the power plant will pay P8.00 per m of sorted solid waste delivered to the plant, where should the solid-waste site be located? Use the city's viewpoint and assume that 200,000 m of wastes will be hauled to the plant for one year only. What site must be selected? Show your computation and defend your answer. (20 points)
The government is imposing an industrial pollution tax in an attempt to reduce carbon emissions. The cost of the tax to five major companies in the oil refining industry will be $50 million annually. In terms of reduced emissions, the annual benefits of the tax are valued at $10 per person. There are 125 million people directly affected by emissions from oil refineries owned by these companies. The total annual cost of this tax is _____________________ while the total annual benefit to society is _____________________. Question 2 options: $250 million, $1.25 trillion $500 million, $1.5 trillion $250 million, $1.5 trillion $500 million $1.25 trillion
QUESTION 7 Choose a wrong statement about uniformly mixed fund pollutants. O The damage caused by uniformly mixed pollutants is relatively insensitive to where the emissions are injected into the atmosphere. A difficulty with emission charge is determining how high the charge should be set in order to ensure that the resulting emission reduction is at the desired level. The policy can focus simply on controlling the total amount of emissions in a manner that minimizes the cost of control. O The cost-effective allocation is found by equating the total control costs of the two sources.
A local college is deciding whether to conduct a campus beautification initiative that would involve various projects, such as planting trees and remodeling buildings, to make the campus more aesthetically pleasing. For the students of the college, the visual appearance of the campus isnonrival andnonexcludable . Thus, the visual appearance would be classified as a public good. Suppose the college administrators estimate that the beautification initiative will cost $61,110. To decide whether the initiative should be undertaken, administrators conduct a survey of the college's 2,240 students, asking each of them their willingness to pay for the beautification project. The average willingness to pay, as revealed by the survey, is $20. The benefit of the beautification initiative, as suggested by the survey, is . Because the estimated benefit is than the cost, the college administrators undertake the beautification initiative. The calculation of the benefit of…