a. Explain the important steps in the construction of Causal Loop diagram. Also provide link polarities in figure1. Environmental Quality 1 Pressure to Clean Up Environment Cleanup Effort + 5-5 Figure 1 The GDP of Pakistan grows at 5.5 percent per year. Estimate, how many years it will take to double the total GDP?

ENGR.ECONOMIC ANALYSIS
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Question No.2
a. Explain the important steps in the construction of Causal Loop diagram. Also provide link
polarities in figure1.
Environmental
Quality
A
Pressure to Clean Up
Environment
Cleanup Effort
十
5-5
Figure 1
The GDP of Pakistan grows at 5.5 percent per year. Estimate, how many years it will take
to double the total GDP?
Transcribed Image Text:Question No.2 a. Explain the important steps in the construction of Causal Loop diagram. Also provide link polarities in figure1. Environmental Quality A Pressure to Clean Up Environment Cleanup Effort 十 5-5 Figure 1 The GDP of Pakistan grows at 5.5 percent per year. Estimate, how many years it will take to double the total GDP?
Expert Solution
Introduction

The behavior of cause and effect from the perspective of a system is shown using causal loop diagrams. Causal loops demonstrate how causes and effects interact. A causal loop diagram is a tool for showing the relationships among various system variables. A number of nodes and edges make up the diagram. Edges are the links that reflect a connection or relationship between the two variables, whereas nodes represent the variables. Links with a positive or negative sign denote favorable and unfavorable relationships, respectively. The two nodes in a positive causal relationship change in the same direction; for example, if the node where the link begins decreases, the other node also decrease. The other node increases as well if the node where the relationship begins increases. The two nodes in a negative relationship vary in the opposite directions; for example, if the node where the link starts increases, the other node decreases, and vice versa. The variables, the links connecting them, the signs on the links which indicate how the variables are related, and the sign of the loop are the four fundamental components of a causal loop diagram which shows what type of behavior the system will produce. One can better understand the structural dynamics that result in puzzling behavior by presenting a problem or issue from a causal viewpoint.

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