AGE/ECON 337V Natural Resource Economics Fall 2020 Homework Assignment #1 (25 points, turn in online) Passed out August 25, 2020 Due September 1, 2020, 11:59 AM Title: Quantitative Policy Assessment Use the table below to answer these questions below about three alternative policy choices, policy 1, policy 2, or policy 3. Each policy addresses the mission of supplying safe drinking water to 10,000 more people in rural New Mexico. a. Explain which of the three policies below works, which pays, and why (10 pts). b. Which is the most economically efficient policy for providing safe drinking water, i.e. the one for which benefits exceed costs by the most. Explain so a policymaker can understand (15 points). c. (Up to 5 points extra credit) Write a one paragraph summary of your findings that shows creativity, critical thinking, and communication skills. Economics of Safe Drinking Water Investments, Rural New Mexico Policy Name Provides safe drinking water Added Benefit Added Cost to 10,000 more people 1 Build treatment plant yes $20 million $18 million Supply filters for all 2 yes $20 million $22 million domestic wells 3 Home filters on taps no $2 million