An analyst was asked to predict the gross social benefits of building a public swimming pool in Dryville, which has a population of 70,230 people and a median household income of $31,500. The analyst identified 24 towns in the region that already had public swimming pools. She conducted a telephone interview with the recreation department in each town to find out what fee it charged per visit (FEE) and how many visits it had during the most recent summer season (VISITS). In addition, she was able to find each town€™s population (POP) and median household income (INCOME) in the most recent census. Her data are as follows:

a. Show how the analyst could use these data to predict the gross benefits of opening a public swimming pool in Dryville and allowing free admission.
b. Predict gross benefits if admission is set at $1.00 and Dryville has marginal excess tax burden of 0.25. In answering this question, assume that the fees are used to reduce taxes that would otherwise have to be collected from the citizens of Dryville to pay for expenses incurred in operating the pool.

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VISITS FEE INCOME POP 1 168,590 0 2 179,599 0 3 198,595 0 36,879 64,520 104,123 103,073 58,386 116,592 49,945 79.789 98,234 71,762 40,178 22,928 39,031 44,685 67,882 69.625 98,408 93,429 98,077 104,068 117,940 59,757 88,305 84,102 20,600 33,400 39,700 32,600 24,900 4206,662 0 5 170,259 0 6 209,9950.2538,000 7 172,018 0.2526,700 8190,8020.25 20,800 9 197,019 0.25 26,300 10186,5150.50 35,600 11 152,679 0.50 38,900 12 137,423 0.50 21,700 13 158,056 0.50 37,900 3 14 157,424 0.50 35,100 15179,490 0.50 35,700 16 164,657 0.75 22,900 17 184,428 0.75 38,600 18 183,8220.75 20,500 19 174,510 1.00 39,300 20 187,820 1.00 25,800 21 196,3181.25 23,800 22 166,6941.50 34,000 23 161,716 1.50 29,600 24 167,505 2.00 33,800 or