A public service official is appraising a project proposal for a project to be done by a domestic firm. The project's present values of benefits and costs, at market prices, are $3000 and $1550 respectively. If the project goes ahead, tax of $700 will be paid to the country, and pollution costing an estimated $250 will occur in the country. Assuming that the firm is a part of the referent group, what are the net present values generated by: a) The market cost benefit analysis = $ b) the private cost-benefit analysis = $ c) The efficiency cost benefit analysis = $ d) the referent group cost benefit analysis = $

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
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Chapter1: Making Economics Decisions
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QUESTION 6
A public service official is appraising a project proposal for a project to be done by a domestic firm. The project's present values of benefits and
costs, at market prices, are $3000 and $1550 respectively. If the project goes ahead, tax of $700 will be paid to the country, and pollution
costing an estimated $250 will occur in the country. Assuming that the firm is a part of the referent group, what are the net present values
generated by:
a) The market cost benefit analysis = $
%3D
b) the private cost-benefit analysis = $
%3D
c) The efficiency cost benefit analysis = $
%3D
d) the referent group cost benefit analysis = $
Provide your answers to two decimal places. Do not include any commas in your answer (i.e. do not include a "," between numbers). Ensure
you show all your working in your spreadsheet.
Transcribed Image Text:QUESTION 6 A public service official is appraising a project proposal for a project to be done by a domestic firm. The project's present values of benefits and costs, at market prices, are $3000 and $1550 respectively. If the project goes ahead, tax of $700 will be paid to the country, and pollution costing an estimated $250 will occur in the country. Assuming that the firm is a part of the referent group, what are the net present values generated by: a) The market cost benefit analysis = $ %3D b) the private cost-benefit analysis = $ %3D c) The efficiency cost benefit analysis = $ %3D d) the referent group cost benefit analysis = $ Provide your answers to two decimal places. Do not include any commas in your answer (i.e. do not include a "," between numbers). Ensure you show all your working in your spreadsheet.
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