A Major Advantage of Using Contingent Valuation Methods Is the Fact

question 21

True/False

A major advantage of using contingent valuation methods is the fact that they rely on surveys.
Although it is true that surveys are relatively easy to administer,they are also prone to bias since respondents will have incentives to misrepresent their true WTP for the environmental amenity.Other problems inherent with surveys include the biases of the creator of the survey questions,problems with small sample size and self-selection issues.These problems associated with the use of surveys make them a "disadvantage" of CVM.

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Definitions:

Adam Smith

A Scottish economist, philosopher, and author, often considered the father of modern economics known for his theories on free markets and the 'invisible hand' guiding economies.

Free Trade

An economic policy that allows imports and exports with little to no government tariffs, quotas, or subsidies, aiming to enhance global economic efficiency.

Balance of Trade

The difference in value between a country's imports and exports over a certain period, indicating how much more goods and services a nation exports than it imports.

Services

Intangible products such as consulting, banking, cleaning, and education that are consumed at the point of sale.