Chapter 8: BCA Costs

Question 1

a regulation to reduce pesticide use can affect which results in but also which is a net benefit to society

Answer 1

increase private COP
decrease profits or firms will charge consumers a higher price
social cost decreases

Question 2

Data to estimate costs come from survey records.
What are 3 issues?

Answer 2

surveys record past costs which are not predictive of future costs

not have good records

incentive to lie about their actual costs in hope of weaker regulations