Question
let the number of recreational visits to a beach per year be represented by Q,and the travel cost in dollars to the beach be represented
let the number of recreational visits to a beach per year be represented by Q,and the travel cost in dollars to the beach be represented by P. Suppose the estimated recreational inverse demand function is P = 2,000-500Q+ 500q, where q represents a measure of water quality in units.
a.Suppose some visitor’s travel cost to the beach is $30 per trip. If the current water quality is zero, how many trips per year to the beach will this visitor make and what will be her consumer surplus?
b.Suppose a project to clean up the beach improves water quality to 5 units. How many trips per year will be taken by all visitors to the beach? What is the estimated benefit of the project to visitors?
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Get StartedRecommended Textbook for
A Survey of Mathematics with Applications
Authors: Allen R. Angel, Christine D. Abbott, Dennis Runde
10th edition
134112105, 134112342, 9780134112343, 9780134112268, 134112261, 978-0134112107
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