Calculate the net benefits of leasing the land

Assignment Help Business Economics
Reference no: EM13802200

The environmental protection agency of a county would like to preserve a piece of land as a wilderness area. The current owner has offered to lease the land to the county for 20 years in return for a lump-sum payment of $1.1 million, which would be paid at the beginning of the 20-year period. The agency has estimated that the land would generate $110,000 per year in benefits to hunters, bird watchers, and hikers. Assume that the lease price represents the social opportunity cost of the land and that the appropriate real discount rate is 4 percent. Assuming that the yearly benefits, which are measured in real dollars, accrue at the end of each of the 20 years, calculate the net benefits of leasing the land.

Reference no: EM13802200

Questions Cloud

Subsidiary and special ledgers journals : Subsidiary and Special Ledgers Journals
What is the value of marginal product of labour : Suppose the employees of Starbucks in China are paid 8 yuan per hour and a cup of coffee is priced at 8 yuan. If Starbucks is maximising its profit, a what is the value of marginal product of labour (VMPL) per hour of the last worker employed by Star..
Why are the project charter statement artifacts critical : Why are the Project Charter and Project Scope Statement artifacts critical to the success of a project? Describe some of the key elements of these artifacts.
How teachers ensure that student have multiple opportunities : How can teachers ensure that students have multiple opportunities to access language throughout each lesson? What can a teacher do if the textbook is not comprehensible to the students in his or her classroom?
Calculate the net benefits of leasing the land : The environmental protection agency of a county would like to preserve a piece of land as a wilderness area. The current owner has offered to lease the land to the county for 20 years in return for a lump-sum payment of $1.1 million, which would be p..
Which project offers larger net benefits : A town’s recreation department is trying to decide how to use a piece of land. One option is to put up basketball courts with an expected life of eight years. Another is to install a swimming pool with an expected life of 24 years.
What are the advantages and disadvantages of web 2.0 : What are the advantages and disadvantages of Web 2.0
Provide additional practice that addresses the content : Modify the lesson plan that you created in Topic 5 to integrate the use of technology. The modified lesson should provide additional practice that addresses the content and language objectives.
Calculate the present value of net benefits : A highway department is considering building a temporary bridge to cut travel time during the three years it will take to build a permanent bridge. The temporary bridge can be put up in a few weeks at a cost of $740,000. Calculate the present value o..

Reviews

Write a Review

Business Economics Questions & Answers

  Predictions for the economy of thrifty peg

Total hours worked, and average labor productivity all are procyclical. Which variable, output or total hours worked, increases by a larger percentage in expansions falls by a larger percentage in recessions.

  Required rate of return on the bond

What is the value of a 10 percent annual coupon, $1,000 par value bond with 20 years to maturity if the required rate of return on the bond is 12 percent?

  What is the resulting outcome of the game

what is the resulting outcome of the game? (b) Suppose now that dierent players obtain dierent shares (adding up to 1) when the majority vote is not passed. What happens in a SPNE then?

  One hour to talk with only one person

If Latanya plans to use the phone for one hour to talk with only one person, with whom would she rather speak.

  What is the value of s that would make both options a and b

For both options, your interest rate is 6% compunded monthly. If the car has a value of S after the 36 months period, what is the value of S that would make both options A and B economically equivalent?

  In a classical model a decrease in population

In a classical model a decrease in population would

  Discuss demand curve for wheat

"The cost of a bushel of wheat, which was $3.00 last month, is $3.70 today. The demand curve for wheat must have shifted rightward in last month and today." Discuss

  Compute most favorable output

Compute most favorable output also profit for each firm and the market price. Also, compute the resulting profit of cartel.

  Necessity of government intervention

Under Illustrate what conditions are likely to be internalized without the necessity of government intervention

  What makes the united states a successful country

The cause and effect on how and why there was a government shut down a month ago.

  Find that a comparable building has become available in city

Suppose you are considering moving your company’s headquarter from Nashville to LA. Last year you paid $100,000 for an option to buy a building in LA. The option gives you the right to buy the building at a cost of $1,000,000, so that if you ultimate..

  Informal and modern urban wage-traditional rural income

Consider the following distribution of income in a 12 person economy, with the modern urban wage=3, the traditional rural income=1 and the informal urban wage = 2: (1,2,3,1,2,3,1,2,31,2,1). the poverty line is at 1.3. What is the level of absolute po..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd