The Boundary Waters Canoe Area Wilderness (BWCA) located in northeastern Minnesota has 1 million acres of wilderness,
Question:
The Boundary Waters Canoe Area Wilderness (BWCA) located in northeastern Minnesota has 1 million acres of wilderness, 1,000 waterways, and 1,500 miles of canoe routes. While some youth, for example those in the Boy Scouts, are on high-adventure treks for 10 days at a time, it is common to have the rest of their family take advantage of the opportunity to also enjoy the BWCA area. A new area for this purpose is to be developed and will have an equivalent annual cost of \(\$ 30,000\), including initial cost (design, clearing, potable water, restrooms, showers, road, etc.), operating, upkeep, and security. Approximately 250 families will camp for 8 days each during the summer season. Another 2,200 persons will be admitted for single-day use of the facilities during the summer season. Although there are currently no fees charged, the average family camping in the area is willing to pay \(\$ 12.00 /\) night for the privilege, with some willing to pay more and some less. The average day user would be willing to pay \(\$ 4.00 /\) day, again some more and some less.
a. What is the anticipated \(B / C\) ratio of this recreation area?
b. What is the value of \(B-C\) ?
Step by Step Answer:
Principles Of Engineering Economic Analysis
ISBN: 9781118163832
6th Edition
Authors: John A. White, Kenneth E. Case, David B. Pratt