a.

A flood control district can construct a number of altemative control works to alleviate

the flood pattem in that area. These alternatives include dam A, dam B, and a levee system C. The levee system can be built alone or In combination with dam A or B. Both dams cannot be built together but either one can function alone. The life of each dam is 80 years and the life of the levee system is 60 years. The cost of capital is 6 percent. Information on total investment, operation and maintenance costs, and average annual flood damage IS given in the table below. What form of flood control would be the most economical?

Project	Total Investment (thousands GH)	Annual Operation and Maintenance (thousands GH)	Average Annual Flood Damages (millions GH<)
Dam A	6.2	93	1.10
Dam B	5.3	89	I .40
Levee C	6.7	110	0.80
Do nothing	0	0	2.15

b. A consumer spends all his income to purchase pipe bome water or well water or both. By the use of Graphs, explain the direction of a shift in the consumer budget line if:

1. i. Price of pipe borne water increase and that of well water remains unchanged.
2. Prices of both commodities increase in the same proportion.
3. Income of the consumer decreases but prices of both commodities remain the same.