What is Discounting in Benefit-Cost Analysis? Also please give examples that are related to the environment?

Question

Please give examples that are related to the environment i.e. projects, issues, etc.

Answer 1

The value of cost or benefits at some future time has a present value that is discounted just like a bond.
present value= value N years in future / (1+r)^N
It is very important when deciding how much current consumption and investment should be sacrifice to prevent a future environmental cost due to things like building dams, over fishing, or destruction of forests. There is a lot of debate about how to discount the effects of CO2 on global warming.

Answer 2

its me, At some point, if industrialism went unchecked, all the trees would be cut down, the air would become a health risk, the rain would become unpotable. So, the cost of limiting production (environmental regulation) is offset by the benefits of breathable air, potable water and trees to hug. External costs would include pollution reducing processes and/or waste processing/recycling. Cost effectiveness just means finding the cheapest way to use the natural resources within the limits of environmental regulation.