In applying the Ramsey formula for assessing net present value of climate changeprojects in a benefit-cost analysis, the effect of an increasing economic growth rate wouldbe to:a.favor investing in the climate change project.b. favor using those funds, i.e. consumption, today in alternative activities.O c.shift the pure rate of time preference to a larger number.Od.increase the net present value of the project.

Here, Net Present value: It refers to the cash flows that is all present with the firms. It is a…

In applying the Ramsey formula for assessing projects in a benefit-cost analysis, the effect a be to: a. favor investing in the climate change, O b. favor using those funds, i.e. consump shift the pure rate of time preference c.

In applying the Ramsey formula for assessing projects in a benefit-cost analysis, the effect a be to: a. favor investing in the climate change, O b. favor using those funds, i.e. consump shift the pure rate of time preference c.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

In applying the Ramsey formula for assessing net present value of climate change
projects in a benefit-cost analysis, the effect of an increasing economic growth rate would
be to:
a.
favor investing in the climate change project.
b. favor using those funds, i.e. consumption, today in alternative activities.
O c.
shift the pure rate of time preference to a larger number.
Od.
increase the net present value of the project.

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