We are trying to calculate the ”shadow price” of Boom Island State Park in Minneapolis. Entrance to the park is free, and it receives 750,000 visitors per year. Suppose Fort Snelling State Park in Saint Paul is virtually identical. Fort Snelling charges $10 per visit, and receives 550,000 visitors per year. (Assume for simplicity each visitor only visits once.) Assume the demand curve is linear. Using the market analogy method, draw the demand curve for Boom Island, labeling important components. Calculate the revenue collected by Minnesota from Fort Snelling. Shade in this area on the chart. Calculate the surplus from Boom Island. Why are your answers from parts (2) and (3) not identical?

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