The Oklahoma City Zoo has proposed adding to their Web site a major segment providing a virtual

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The Oklahoma City Zoo has proposed adding to their Web site a major segment providing a virtual tour of the grounds and animals, suitable for both routine enjoyment and educational purposes in classrooms. Survey data indicate that this will have either a neutral or positive effect upon actual zoo attendance. The Web site will be professionally done and have an initial cost of \(\$ 325,000\). Upkeep, refreshing the videos, and developing videos for scientific research and entertainment will cost another \(\$ 80,000\) per year. The zoo is expected to be in operation for an indefinite period; however, a study period of only 10 years for the Web site is to be assumed, with only a residual (salvage) value of \(\$ 60,000\) for the archival value being anticipated. Interest is 7 percent. An estimated 100,000 persons will visit the e-zoo in the first year, increasing by 30,000 each year, and they will receive, on the average, an additional \(\$ 0.80\) of benefit per visit when the new area is complete. On the basis of \(B / C\) analysis, should the Web site be supported for funding?

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Principles Of Engineering Economic Analysis

ISBN: 9781118163832

6th Edition

Authors: John A. White, Kenneth E. Case, David B. Pratt

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