Question
Suppose a regulation imposes costs to the economy of $1 bn in the first year, $0.6 bn in the second year and $0.1 bn thereafter.
Suppose a regulation imposes costs to the economy of $1 bn in the first year, $0.6 bn in the second year and $0.1 bn thereafter. Suppose that benefits of $0.5 bn per year start accruing after ten years and continue forever. Suppose the social discount rate is 4%. Should the regulation be adopted?
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Managerial Economics Foundations of Business Analysis and Strategy
Authors: Christopher Thomas, S. Charles Maurice
12th edition
1260004759, 9781260004755, 78021715, 78021718, 78021901, 978-0078021909
