1. This problem refers to the cost benefit analysis in audio 1S35. The "project" is a payment of $850M (M for million) to induce the owner of a professional football team to build a new stadium in Buffalo, NY. NY state residents are the community (the "locals"). a. When we estimate the user benefit, why do we only consider the locals' demand function instead of using the demand function of all buyers of tickets to events in the stadium? b. Locals are paid $800M to build the stadium. In computing their profit from the construction, why do we subtract $425M before multiplying by the 20% profit share? c. Why multiply the difference $800M$425M by 0.2 in computing locals' net generated income from the construction? d. Why annualize the amount $(800M425M)(.2) ? e. Why is the business profit from outsiders estimated to be (.2M)($100)(.2) ? Why do we not annualize this number in estimating the annual net generated income from the project? f. In the estimate of the overall annual net benefit from the project, why do we subtract $42M ? g. There is considerable uncertainty about the benefits from the project. Give two examples of parts of the analysis above that could not be known for sure when the project was planned. Explain how the uncertainty should affect a reasonable estimate of the net benefit to NYS from the project