Question

Suppose the college administrators estimate that the beautification initiative will cost $7,200. To decide whether the initiative should be undertaken, administrators conduct a survey of the college's 300 students, asking each of them their willingness to pay for the beautification project. The average willingness to pay, as revealed by the survey, is $18. A. what is the total monetary value of the benefit of the beautification initiative, as suggested by the survey?

Answer 1

Answer: $5,400

Explanation:

The 300 students on average agreed that they would be willing to pay $18 fo the beautification project.

The total monetary value of the benefit of the beautification initiative, as suggested by the survey is the amount that would be accrued if every student paid for the project at their Average Willingness to pay.

This would be,

= 300 * 18

= $5,400

The Total Benefit as suggested by the Survey is $5,400.

NB - The Total Benefit as suggested by the Survey is LESS than the cost of the Survey so the project SHOULD NOT be embarked on.