Welcome to JustAnswer! I am a licensed veterinarian and would be glad to help!
1) Is he neutered?
2) Is he urinating without difficulty?
No he is not neutered, "m not sure if he is urinating without a problem. I only noticed it when I let him in from the back yard. when he was urinating yesterday it didn't seem as if he was having any issues
Does the tip of the penis look like this?
Yes it does.
Excellent - pictures help!
That is what is called a urethral prolapse.This is most often treated surgically.
What causes this?
Link here for further information: http://www.petplace.com/dogs/urethral-prolapse-and-neoplasia/page1.aspx
Causes of Urethral Prolapse
Is this something that just develops in dogs or is it hereditary?
It can be both, as English bulldogs and Boston terriers are common with Pit Bulls and other affects young to middle aged male dogs being most affected.
How long will recovery be when he gets the surgery. Is their another route to go besides surgery? Or is this the only option?
There is not another option for a true, urethral prolapse
Is he in pain? He seems fine for the most part. Do you know how much a surgery like this would cost?
It is uncomfortable.
A surgery will depend on who performs it - but it should ideally be done by a specialist
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