Question
7. Based on work by RG Walsh, G.L Peterson, and J.R. McKean (1989) , estimated individual demand for on-site wilderness recreation at the BWCA can
7. Based on work by RG Walsh, G.L Peterson, and J.R. McKean (1989) , estimated individual demand for on-site wilderness recreation at the BWCA can be estimated as equal to
Q = 5 - 0.1P
where P represents the price, or willingness to pay for a day at the BWCA, and Q represents the number of days per year an individual will spend at the BWCA.[1]
It costs on average $10 per day to visit the BWCA.
Current use of the BWCA is estimated at 250,000 visits per year.[2] At this level of use, the benefits of the BWCA are best characterized as public goods; they are non-excludable and non-rival. Based on your calculations of the expected consumer surplus enjoyed by BWCA visitors, and assuming that the marginal production costs of the BWCA are essentially zero, what is the total consumer surplus generated each year by the BWCA's use values as a source of wilderness recreation?
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