Suppose Knoxville is considering building a new park in south Knoxville at the end of the greenway. Because it is in south Knoxville this new park is not expected to affect visitation at other parks. Based on a study of other parks in town you determine that the annual demand for visits to this park is Visits = 300-150f where f is the entrance fee for visiting the park in dollars. The annual cost of the park is $1,000. Nobody wants to pay an entrance fee, so no revenue will be collected. Since revenue cannot be directly compared to cost, city officials are unsure if the park is justified. If asked, would you tell the city officials the park is justified? Explain.
Suppose Knoxville is considering building a new park in south Knoxville at the end of the greenway. Because it is in south Knoxville this new park is not expected to affect visitation at other parks. Based on a study of other parks in town you determine that the annual demand for visits to this park is Visits = 300-150f where f is the entrance fee for visiting the park in dollars. The annual cost of the park is $1,000. Nobody wants to pay an entrance fee, so no revenue will be collected. Since revenue cannot be directly compared to cost, city officials are unsure if the park is justified. If asked, would you tell the city officials the park is justified? Explain.
Chapter1: Making Economics Decisions
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Transcribed Image Text:Suppose Knoxville is considering building a new park in south Knoxville at the end of the
greenway. Because it is in south Knoxville this new park is not expected to affect visitation
at other parks. Based on a study of other parks in town you determine that the annual
demand for visits to this park is Visits = 300-150f where f is the entrance fee for visiting the
park in dollars. The annual cost of the park is $1,000. Nobody wants to pay an entrance fee,
so no revenue will be collected. Since revenue cannot be directly compared to cost, city
officials are unsure if the park is justified. If asked, would you tell the city officials the park is
justified? Explain.
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