Answer the following questions (copy and paste them into your document). Answer each question thoroughly but try to use no more than 3-4 sentences if possible (pick your words carefully). Each question is worth 20 points.
1. What is the economic definition of a scarce resource? Describe this concept using an environmental resource (e.g. air, water, trees, forage, fish, etc.). How are prices a helpful indicator of relative scarcity? Does this mean when something doesn’t have a price, it must not be scarce?
2. Explain what is wrong with this sentence, “We should spend whatever it takes to reduce pollution to zero.”
3. What is “derived demand” and how does it relate to the pollution problem? Given the concept of derived demand, who do you think is most responsible for pollution: producers, consumers, or both? Explain your rationale USING ECONOMICS.
4. Suppose a biologist has a choice between implementing two mutually exclusive stream restoration projects and completes a cost-benefit analysis on the alternatives. Assume all benefits and costs (market and non-market), have been dollar-quantified (and risk/uncertainty eliminated). Project 1 costs $20,000 (construction, materials, labor, etc.) and has a NPV = $12,000. Project 2 costs $10,000 and has a NPV = $-500. The biologist’s supervisor wants to implement Project 2 because it costs less money. Answer the following questions: 1. What is NPV and how does it help us evaluate alternative decisions? 2. Which of the projects should be chosen? Explain your rationale using economics (include tradeoffs and opportunity costs in your discussion).
5. What is an externality? What is the goal of economic policy regarding externalities? Give a real-world example of a negative externality that you have personally experienced as a 3rd party. Was the situation resolved in an economic manner? Why or why not?
The assignment must contain references with corresponding in-text citations in the body of the document in APA style. Single or double-spacing is allowed. Please use an easily readable 12 point font (e.g., Times New Roman, Arial, Verdana). Your name should appear somewhere at the top. You are free to use an APA paper template if you wish, but omit the Abstract and instead of APA headings, copy and paste the questions.
Please no plagiarized work, thank you 🙂