Problem set 1 solutions

Problem set 1 solutions - Problem Set 1 Solutions October...

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Unformatted text preview: Problem Set 1 Solutions October 3, 2011 Discussion Questions Chapter 2, #1: It's not desirable to eliminate all emissions of sulfur dioxide if the marginal cost of eliminating some unit of sulfur dioxide is greater than the marginal bene t of eliminating that unit. For zero pollution to be e cient, the marginal bene ts must always exceed the marginal costs of elimi- nation. This might be the case if 1) marginal bene ts are always non-zero (e.g. even a little bit of pollution hurts somebody somewhere.) 2) marginal costs are 0 (for example, if there is an easily-accessible supply of sulfur-free power fuel alternatives.) Chapter 2, #6: Some pros of this approach: 1. The most productive agriculture land is available to farmers. 2. Less access infrastructure has to be built to access valley land. Roads don't have to be built as far and fewer rocks have to be moved. 3. Alpine areas are still available as open wilderness or for dislocated species. Some arguments against this approach: 1. A richer species habitat would be available if valley land were preserved. 2. The alpine land might still have some uses which aren't in play because the land is preserved. For example, alpine land can be used to graze high altitude farming species like alpacas....
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This note was uploaded on 01/30/2012 for the course ECON 131 taught by Professor Groves during the Fall '09 term at UCSD.

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Problem set 1 solutions - Problem Set 1 Solutions October...

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