The hedonic price method
A) is a direct method of estimating benefit
B) relies on the theory that goods are valued for their attributes
C) is a physical linkage approach
D) is useful but not intuitive

Question

Quizplus · Accepted Answer

The hedonic price method is based on the theory that goods are valued for their attributes, such as quality, location, and other characteristics. It estimates the implicit prices of these attributes by analyzing data on prices and characteristics of different goods. This method indirectly estimates benefits by valuing the attributes that contribute to the overall value of a good.

The Hedonic Price Method