Problem
In "Valuing Reduced Risks to Children: The Case of Bicycle Safety Helmets," economists Robin R. Jenkins, Nicole Owens, and Lanelle Bembenek Wiggins estimate the value of the lives of children by using parents' willingness to purchase bicycle helmets. Wearing a helmet reduces the probability of death frombicycling by .0000041. The annualized cost of a helmet is $6.51.
a. What economic concept is their study based on?
b. Assuming helmets are worn 100 percent of the time, what is the value of life parents place on a child as revealed by their purchase of a bicycle helmet?
c. What happens to the value-of-life estimate if parents expect their children to wear the helmets less than 100 percent of the time?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.