Identify the viewpoint (e.g., budget, government unit, citizen, business owner), and categorize the following cash flows as a benefit, disbenefit, or cost:

Question

(a) $600,000 annual income to area businesses from tourism created by new freshwater
reservoir/recreation area
(b) $450,000 per year for repainting of bridge across the Mississippi River
(c) $800,000 per year maintenance by container-ship port authority
(d) Loss of $1.6 million in salaries for border residents because of strict enforcement of
immigration laws
(e) Reduction of $600,000 per year in car repairs because of improved roadways
( f ) Expenditure of $350,000 for guardrail replacement on freeway
(g) $1.8 million loss of revenue by farmers because of highway right-of-way purchases

Answer 1

(a) $600,000 annual income to area businesses from tourism created by new
freshwater
reservoir/recreation area – citizen or business owner; benefit
(b) $450,000 per year for repainting of bridge across the Mississippi River – budget;
cost
(c) $800,000 per year maintenance by container-ship port authority – government; cost
(d) Loss of $1.6 million in salaries for border residents because of strict enforcement of
immigration laws – government; disbenefit or citizen; cost
(e) Reduction of $600,000 per year in car repairs because of improved roadways –
citizen;
benefit or business owner; cost
(f) Expenditure of $350,000 for guardrail replacement on freeway – government; cost
(g) $1.8 million loss of revenue by farmers because of highway right-of-way purchases
-
government; disbenefit or farmer; cost