Question

Why does it matter if the government uses a larger discount rate when calculating the NPV of a proposed regulation? Why is the discount rate especially important for thinking about climate change?

Name: why does it matter if the government uses a larger discount rate when calculating the npv of a proposed regulation why is the discount rate especially important for thinking about climate ch 96719
Uploaded: 2024-06-29T14:30:31-08:00
Duration: 2 min 1 s
Channel: Crystal Wang
Description: why does it matter if the government uses a larger discount rate when calculating the npv of a proposed regulation why is the discount rate especially important for thinking about climate ch 96719

          Why does it matter if the government uses a larger discount rate when calculating the NPV of a proposed regulation? Why is the discount rate especially important for thinking about climate change?

Added by Rebecca P.

Horngren’s Cost Accounting

Srikant M. Datar, Madhav V. Rajan 16th Edition

Instant Answer

Solved by Expert Crystal Wang

06/29/2024

Step 1

- The discount rate determines how much weight is given to future benefits and costs relative to today. A higher rate makes distant effects much smaller in present value terms; a lower rate treats future effects as more important. Show more…

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Why does it matter if the government uses a larger discount rate when calculating the NPV of a proposed regulation? Why is the discount rate especially important for thinking about climate change?