In the United States, approximately 100 billion single use plastic bags per year. 99% of these bags are improperly disposed of. Plastic shopping bags create numerous negative externalities for the environment and for businesses. Production of plastic bags rely on petroleum, which emits pollutants during combustion. Plastic litter is toxic and harmful to ecosystems. Recycling centers are forced to shut down machines to detangle plastic film. Coastline-dependent economies suffer from contaminated ecosystems and trash filled beaches. My research utilizes Capital Budgeting Analysis to determine the net present value of alternative plastic bag waste reduction policies on various stakeholders in Asheville, NC. The policies I have included are: a ban on plastic bags with free paper bags, a ban on plastic with a 10 cent paper bag fee, and a 10 cent fee on both plastic and paper bags. The stakeholders I have included are: customers, recycling centers, large scale grocery stores, and city cleanup. I collected data from the city of Asheville and other studies to determine cash flows and when they occur. I then used Asheville municipal coupon bonds to determine my discount rate. I used these values to calculate the net present value of each policy. If the net present value is positive, it makes economic sense to implement the policy. If the net present value is negative, it does not make sense to implement policy. Since these policies are mutually exclusive I will recommend the policy option that has the highest net present value.
