1.Tell me in 2-4 sentences why this relationship between price elasticity and the incidence of taxation is important for a local authority/government to understand. Specifically, in terms of policy implementation which will involve taxation.

2.Describe, in 1-2 paragraphs, the difference between a basic “cost-benefit analysis” and a “cost-effectiveness analysis”. In addition, tell me a potential scenario where a cost effectiveness analysis should be used instead of a cost benefit analysis.

3.Briefly describe the difference between “willingness to pay” and “willingness to accept” in relation to the demand for environmental goods. Include some thoughts on how the difference between these two measures can create challenges when using a stated preference approach for valuing environmental goods or bads.