Estimated Visitation 

 [Simulated increase in mileage] 



(3) This estimate of 35,000 yields an initial point 

 on the resource's demand curve. To find sufficient 

 points to determine the entire demand curve, it is 

 necessary to make small incremental increases in 

 the price of participation and to measure the quan- 

 tity of use that would be demanded given these 

 chances. This is equivalent to moving the project 

 farther and farther from the potential users, requir- 

 ing them to pay more and more in travel costs. As 

 the simulated distance increases, use decreases, 

 and for each increment in distance a new use esti- 

 mate is computed using either the use estimating 

 model or the per capita use curve. The new use es- 

 timates are the various quantities of recreation that 

 would be demanded at increasing prices. 



(4) For example, assume that an increment of 10 

 miles in travel distance is used to simulate an in- 

 crease in cost for the proposed project described 

 above. The use estimate of use would then be: 



(5) This would be a second point on the re- 

 source's demand curve; the quantity demanded 

 (21,000 visits) at a price equivalent to the travel 

 cost associated with an increment in distance of 10 

 miles. (A discussion of the proxy for price used to 

 assign a dollar value to this increment is in para- 

 graph (6)(i) of this appendix.) 



(6) Remaining points on the resource demand 

 curve are then estimated by making continued in- 

 crements in the price (simulated increases in dis- 

 tance) until the anticipated visitation from all areas 

 of origin is zero. In the example above using 10- 

 mile increments, the visitation expected with simu- 

 lated increases in distance would be: 



(i) Proxy for price. (A) To determine the price at 

 which the various quantities of use are demanded, 

 the incremental increases in distance are simply 

 converted into the costs that would be incurred by 

 the recreation users if they were required to travel 

 the additional mileage. The variable or out-of- 

 pocket travel costs are used as the proxy for price, 

 since these are the costs that potential users would 

 be most aware of when making a decision about 

 whether to visit a particular resource area. 



(B) The conversion of mileage to price should 

 use the most current published results of studies 

 conducted penodically by the U.S Department of 

 Transportation concerning the average cost of op- 

 erating an automobile. As an example, average 

 variable cost estimates for 1976 are summarized 

 below (U.S. Department of Transportation, 1977). 



Average Variable Costs, in Cents Per Mile, to 

 Operate an Automobile 



Automobile type 



Variable cost category 



Mainlence, accessories, 

 parts, and tires 



Gasoline and oil 



Taxes on gasoline, oil, 

 and tires 



Total 



(C) The variable cost reflects the average out-of- 

 pocket cost per mile to operate various types of 

 automobiles. It does not include such fixed costs as 

 depreciation, insurance, and registration, since 

 those costs would generally not affect the potential 

 user's decision to travel the additional mileage for 

 recreation purposes. 



(D) Two adjustments are required, however, 

 before this cost can be used as the proxy for pnce. 

 The first is an adjustment for round-trip mileage. 

 The distance measure used in the per capita use 

 curve or regional estimator is one-way mileage, 

 while the recreation user must incur the variable 



77 



