Calculate net social benefits of the project

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Consider a project that would affect two groups in society: Group A and Group B. Undertaking the project would impose a cost of $4 million on Group A and a cost of $6 million to Group B. The project would yield benefits of $10 million to Group A but benefits of only $2 million to Group B. Assume that these costs and benefits are already expressed in present values.

Calculate the net benefit of the project to each of the two groups.

Which group is a "winner" from this project? Which group is a "loser" from this project?

Calculate the net social benefits of the project.

Based on a CBA, should this project be undertaken?

What does your answer to Part (d) say about the policy's potential for generating a Pareto improvement for Groups A and B?

Reference no: EM133269166

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