Benefits, Cost and Property Rights

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Benefits, Cost and Property Rights

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University of Colorado at Boulder
Econ 3535 - Natural Resource Economics

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Lecture 7 Current Lecture Current Event: Government released the 4th quarter real GDP report today - 3rd quarter = 5% annual rate - 4th quarter = 2.6% annual rate o 2014: 2.4% o average growth 2010-2013 = 2.2%  1990s = 3.4% - It’s good that the growth rate has decreased because it allows the economy to avoid inflation, and the unemployment will still decline Benefits - revealed preference - stated preference  surveys Cost - survey approach  survey of project - engineering approach  cost-based on current technology Property Rights - consumer surplus: willingness to pay versus the price actually paid o difference between what consumers are willing to pay and the price paid - price discrimination: isolation of what you’re willing to pay and change it according to the situation to a higher price Producer Surplus = difference between price and supply curve - total net benefit = consumer surplus + producer surplus - property rights = ownership - open access resources = no ownership; no restrictions on access ECON 3535 1st Edition

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