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4 ) NASA scientists have located a large asteroid that they are certain will collide with Earth in 2 9 0 years, doing catastrophic damage
NASA scientists have located a large asteroid that they are certain will collide with Earth in years, doing catastrophic damage and imposing costs of $ trillion $ They were prepared for this contingency, and have already proposed a solution: they want to build and launch a rocket that would reposition the asteroid and prevent the collision with Earth entirely. The rocket would be constructed and launched right away the Earths current orbit is such that we are as close to this asteroid as we will ever be prior to the projected collision, so this is our best opportunity so all of the projects costs would be incurred immediately. The scientists have learned valuable lessons from the movie Armageddon and are certain that the project would succeed if undertaken.
a Using a constant annual discount rate of and assuming that all of NASAs projections are correct, how much should we be willing to pay for this intention ie what is the present value of the projects benefits, which are the same as the costs that would be avoided by the project
b Using the timedeclining discount rate schedule proposed by Moore et al and assuming that all of NASAs projections are correct, how much should we be willing to pay for this intervention ie what is the present value of the projects benefits, which are the same as the costs that would be avoided by the project
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