Changes in the hydrologic behavior of watersheds can be voluntary, indirect, inadvertent or in any combination. Many of these changes will require environmental impact statements to reflect both beneficial and adverse effects. Man-made changes are planned to meet a particular goal. To choose the most appropriate hydrologic model for predicting these modifications, the standardized cost-effectiveness analysis is recommended. In this methodology, the following steps are included: definition of goals, identification of specifications for realization of goals, development of alternative models to achieve goals, establish measures of effectiveness for evaluation of alternative models, determine capabilities and analyze merits of models and perform sensitivity analysis on goals, specifications and measures of effectiveness. For predicting changes on ungauged watersheds, many hydrologic models encounter calibration, validation or extrapolation problems. It is possible, however, to obtain an approximation of these changes with the use of simple models of the rainfall-runoff process. Two such models are compared in determining the effect of urbanization on the return period of a flood of given magnitude.