Practice Problem 3 Flashcards
What is resource taxonomy
Classification system for various categories of resource availability
Define energy elasticity of demand
A measure of the %change in quantity demanded if the determinant changes by 1%
What causes energy insecurity
- Energy supply hazards: physical, econo, social disruption, tech and enviro risk
- Shocks: importing countries struggle to cope with rise in price of oil
- Demand > supply
- Climate change, political instability, and terrorist acts
List the indicators of energy security
- Continuous availability of energy
- Low vulnerability of vital energy systems
- Economy is protected energy supply disruptions
- Four A’s achieved, resources are: available, accessible, acceptable, and affordable
What are the implications of govt intervention in energy mkts
What is the input-output model
Examines the interdependencies between different sectors by considering how goods and services are produced and consumed within an economy.
How is the IO model applied in energy security and policy
Add the demand of one sector into the supply/demand equation of the other to calculate how much that industry needs to produce wrt the other.
Define discount rate wrt optimal harvest time
The discount rate influences the timing of harvest, as future harvesting costs are discounted. Maximizes discounted net benefits.
Define optimal harvest time
Calculated by dividing total wood volume by stand age
What factors affect forestry harvesting decisions
What is the decision rule for biological and economic context in forestry
What are forestry certification standards
Compare private vs public forestry mgmt
What causes inefficiency in forestry mgmt
- Perverse incentives: bad policies that encourage deforestation or illegal logging
- Externalities: deforestation has global impacts such as biodiversity loss and climate change
Compare the clear cut value vs sustainable forest mgmt
Cutting all trees in an area vs selective logging so young trees mature and ecological function is protected
