In each case, indicate whether the statement as given is true/false/uncertain an

Question

In each case, indicate whether the statement as given is true/false/uncertain and explain why. Points will be given for the explanation of your answer only. Write your answers as completely as possible.

1.   The large gap between willingness-to-pay (WTP) and willingness-to-accept (WTA) measures obtained through stated preference surveys provides evidence of the failure of stated preference approaches to value nonmarket goods.
2.   Single site models of recreation demand can provide only a partial picture of the demand for recreation and, as a result, are of limited use in valuing environmental amenities.

Explanation / Answer

1.This is true. Stated prefrences are used to virtually estimate all the environmental values.According to stated prefrence surveys there is large gap between willingness-to-pay (WTP) and willingness-to-accept (WTA) which leads to failure of the model.

2. True.   Single site models of recreation demand can provide only a partial picture of the demand for recreation and, as a result, are of limited use in valuing environmental amenities. Therefore, multiple sites models should be used.

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