The data in the table below show the breakdown of the Referent Group (RG) benefits for two projects (A and B), information about each sub-group’s income level and marginal propensity to save (mps). In addition, you have ascertained that the mean income level is $30,000 per annum, that an appropriate value for ‘n’ (the elasticity of marginal utility with respect to an increase in income) is 2, and that the premium on savings relative to consumption is 10%.

RG1 RG2 RG3 Income p.a. ($) 20,000 40,000 90,000 Mps 0.05 0.20 0.60 Net Benefits – A ($) 10 20 90 Net Benefits – B ($) 20 30 40 With this information you are required to calculate and compare the projects’ net benefits in terms of:

i unweighted aggregate Referent Group net benefits;

ii aggregate net benefits weighted for atemporal distributional objectives (assuming consumption and savings have the same value at the margin); and, iii aggregate net benefits weighted for both atemporal and inter-temporal distributional objectives.