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Business, 20.12.2019 22:31 mayaleila

Lincoln park zoo in chicago is considering a renovation that will improve some physical facilities at a cost of $1,800,000. addition of new species will cost another $310,000. additional maintenance, food, and animal care and replacement will cost $145,000 in the 1st year, increasing by 3 % each year thereafter. the zoo has been in operation since 1868 and is expected to continue indefinitely; however, it is common to use a 20-year planning horizon on all new investments. salvage value on facilities after 20 years will be 40 % of initial cost. interest is 7 %. an estimated 1.5 million visits per year are made to the zoo, and the cost remains free year-round. how much additional benefit per visit, on average, must the visitors perceive to justify the renovation?

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