Since economic valuation of benefit is based on the concept of WTP, this implies that…
A) The benefits from improved environmental quality are equal to the value of the
environment.
B) The benefits from improved environmental quality are greater than the value of the
environment.
C) The benefits from improved environmental quality are the preferences of people for an
environmental good.
D) The benefits from improved environmental quality are greater than the preferences of
people for an environmental good.

Question

Since economic valuation of benefit is based on the concept of WTP, this implies that…
A) The benefits from improved environmental quality are equal to the value of the
 environment.
B) The benefits from improved environmental quality are greater than the value of the
 environment.
C) The benefits from improved environmental quality are the preferences of people for an
 environmental good.
D) The benefits from improved environmental quality are greater than the preferences of
 people for an environmental good.

Quizplus · Accepted Answer

WTP (willingness to pay) is based on the concept of individuals expressing their preferences for environmental goods through the amount of money they are willing to pay for them. Therefore, the benefits from improved environmental quality are the preferences of people for an environmental good, which is represented by their WTP. Option A, B, and D are incorrect interpretations of the concept of WTP.

Since Economic Valuation of Benefit Is Based on the Concept