MPE 781- Economics for Managers | Environment Factors Assignment

Running head: ECONOMICS FOR MANAGERS
Economics for Managers
Name of the Student:
Name of the University:
Author’s Note:

1ECONOMICS FOR MANAGERS
Contents
Answer to Question 1......................................................................................................................2
Answer to Question 2......................................................................................................................2
Answer to Question 3......................................................................................................................5
Answer to Question 4......................................................................................................................7
Answer to Question 5......................................................................................................................9
Reference List................................................................................................................................12

2ECONOMICS FOR MANAGERS
Answer to Question 1
The articles discusses about the need of reducing the increasing amount of emission in
the environment due to global warming. The economy has been receiving considerable amount
of threat from the increasing air pollution harming various aspects of life. Sir Nicholas Stern in
this article has discussed about the needs of reducing the emission of CO2 now in order to attain
benefit in the future. According to his experience, a country should invest in pollution reduction
policies to save them from future environmental cost. However, stern gas received a lot of
disagreement from various scholars and policy makers stating that pollution and CO2 emission
reduction is uncertain and it cannot assure a clean environment in future. Thus, it will lead to
waste of finance and effort of the policy makers. The article shows the way by which Stern
proves his point right that pollution reduction in present environment is necessary.
Answer to Question 2
From the abstract, it is clear that controlling global warming in today’s environment is essential
in a greater aspect. The increasing emission of CO2 gas shown in the articles should be
controlled in its equilibrium level in order to save the economy from unforeseen and uncertain
consequences. CO2 is emitted in the environment from the large industries and from plants. It is
not possible to reduce the emission of CO2 from the plants, as they are essential for human
beings. However, reducing the emission from large industries can be done by changing their
operation system. Controlling the increasing level of emission of CO2 has a lot of impact on the
economy and its people.
Rising global warming changes the climate of a region in various ways such as:

3ECONOMICS FOR MANAGERS
 Increase in the temperature of the economy by year after year due to infrared radiation
 This in turn affects economy’s growth rate as people get adversely affected by the
harmful gas
 Global warming also effects the growth in agricultural productivity as most of the crops
get hamper by the increasing amount of harmful gases making them unsuitable for
consumption
 Global warming is also leading to an increase in the sea level immersing a lot of places
under water
The above explanation shows the affect of global warming and increasing emission of
harmful gas in the economy. This proves that reducing pollution in the present scenario is
necessary and should be looked after.
Thus from the above description we can deduce a cost and benefit analysis for the
economy to take decision regarding the reduction in global warming. Some of the cost and
benefit analysis of global warming can be discussed below such as:
 The country can aim to reduce their GNP now with the aim of increasing it in the future.
GNP is the gross national product of the economy which if reduce might cost to the
economy at present. However, controlling the GNP of the country now will help them to
control their CO2 emission. With a much clean environment in future the economy can
again aim to increase their GDP.
 CO2 is also hazardous to the health of the people I an economy. Thus, t is important to
reduce this harmful effect. Even though the cost to reduce the effect will be high at
present; however, it will offer great benefit to the economy with a much healthier