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1. Assume that you are to estimate the costs of either: A project proposal to construct a dam in your local area for hydroelectric power generation. A policy to regulate emissions from Sport Utility Vehicles. A policy to ban offshore drilling in the Gulf of Mexico. There are several environmental implications involved. Identify as many of the costs of these proposed policies or projects as you can. Classify the costs as either explicit or implicit costs. What cost estimation technique would you use to estimate the costs identified? Which costs would be difficult to estimate? 2. Select a local, regional or national environmental problem. Explain the steps that would be used to conduct a Benefit-Cost Analysis of a government policy to alleviate the problem. How would you go about identifying the potential costs of the policy initiative, the Economic Costs (explicit and implicit), the social costs, which estimation method would work best for estimating explicit costs? How do you deal with time differences that result for costs and benefits? What types of time-oriented modifications are necessary? Comment on the objectivity of benefit-cost analysis? What are some issues involved in using this method of analysis? What are its limitations?
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