Machine-translated by Google. Questions are authored in English.
Top

Discussion

A shadow price is used when a benefit or cost

  • A.has no observable market price
  • B.is quoted in a foreign currency
  • C.occurs in the project's final year
  • D.has already been incurred

Answer: A

Correct answer: has no observable market price

Travel time, clean air, an averted injury and a preserved habitat are all real but unpriced, so a value must be imputed from what people reveal or state they would pay. Shadow prices are the weakest link in most studies and are the first thing a sensitivity analysis should be run on.

No comment is present. Be the first to comment.
Loading…

Post your comment

Please log in or register to post a comment.