Principles of Microeconomics
7th Edition
ISBN: 9781305156050
Author: N. Gregory Mankiw
Publisher: Cengage Learning
expand_more
expand_more
format_list_bulleted
Question
Chapter 11, Problem 9PA
To determine
The externality.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Why does the movie theater charge matinee customers a lower price than the night time customers?
Recently, the Metropolitan Transportation Authority (MTA) voted to pass a policy that
charges drivers who enter Manhattan (New York City) on the weekdays from 5am to 9pm,
and 9 am to 9 pm on the weekends.
Passenger vehicles (small cars) would be charged $15, trucks would be charged anywhere
from $24-$36 depending on size, and motorcycles would be charged $7.50.
During the other hours, the charges and tolls will be decreased.
Which of following statements is true?
The MTA believes the highest external cost of driving occurs after 9pm.
The MTA is subsidizing drivers in NYC.
The MTA believes that the external cost of trucks is greater than passenger vehicles and
motorcycles.
Currently (before the tolls go into effect), NYC has the socially optimum quantity of drivers.
Jenny is going to rent a truck for one day. There are two companies she can choose from, and they have the following prices. Company A charges $90 and allows unlimited mileage. Company B has an initial fee of $55 and charges an additional $0.70 for every mile driven.
Chapter 11 Solutions
Principles of Microeconomics
Knowledge Booster
Similar questions
- Why are urban areas willing to subsidize urban transit systems? Does the argument for subsidies make sense to you?arrow_forwardDoes paperless ticketing benefit consumers more than traditional ticketing that allows tickets to be resold? Explain.arrow_forwardWhich of the following explains why a seller might charge a high price when a new video game console is first released and then lower the price as time goes by? Select one: a. The buyers want to buy the new video game console only if the price is high because a high price signals good quality. b. The seller wants to test the market to see how consumers react to the product. c. The seller has to sell the newly released video game console at the government-mandated price. d. The seller can charge a high price to consumers who want to be the first ones to own a newly released product.arrow_forward
- Annabelle typically drives her car to school, but she lives near a bus stop and is willing to take the bus instead. If the price of a bus ticket falls, what would happen in the market for cars?arrow_forwardWhat are the consequences of reduced publicfunding?arrow_forwardToday, an estimated 2 million people drive for Uber, often evenings and weekends after they’re finished the day at a full-time job. Explain how the growth of Uber reflects the way in which ridesharing has altered the opportunity cost of leisure.arrow_forward
- What is most likely the reason?arrow_forwardIt’s increasingly clear that many postings on blogs and product reviews on Web sites are fake or are posted there to manipulate consumers’ opinions. How big a problem is this if consumers increasingly look to consumer-generated product reviews to guide their purchase decisions? What steps, if any, can marketers take to nip this problem in the bud?arrow_forward2arrow_forward
- Spotify, Pandora, and iHeart Radio are some of the more popular music streaming services. These companies offer free access to music. For a small monthly fee, users can purchase premium access and listen to millions of songs on demand and ad-free. But not all artists are fans of free streaming music. Taylor Swift’s move to prevent Spotify from playing her 2016 release, 1989, for free made national headlines. When Spotify refused to restrict access to only paying customers, Swift would not allow the company to play her music for free. She is not alone. Adele, Dr. Dre, Garth Brooks, and Coldplay have all had run-ins with free streaming services. i. If music-lovers obtain music and video content via free music streaming services instead of buying it directly or paying for premium access, what would the record companies’ producer surplus be from music sales? Producer surplus for record companies would... a. be greater than if people had to pay for the music. b. depend on how…arrow_forwardSuppose Brian is in the market for a used textbook and the campus bookstore is having a sale. If the initial price of the used book is $82.50 and the discounted price is $62 , what is the percentage change in the book price? Round your answer to two places after the decimal.arrow_forwardHurricane Sandy to Raise Prices on Used Cars The immediate impact of Hurricane Sandy was devastating, and the storm's ripple effects will continue to be felt in the weeks and months ahead as communities work to recover. One side effect becoming apparent is Sandy's influence on the used car market. According to the Detroit Free Press, the destruction of some 250,000 vehicles has led to a shortage that could affect late-model used vehicle prices nationwide. The National Auto Dealers Association estimates that prices could increase 0.5% to 1.5%. That may not seem like much (550-S175 per vehicle), but Edmunds.com suggests that in the short term, prices could jump $700 to $1.000. Source: George Kennedy, Autoblog, November 10, 2012. © 2012 AOL Inc. All rights reserved. Market for Used Cars Post-hurricane Supply 23000 Pre-hurricane Supply 22000 21000 20000 Market Demand 19000 18000 6000 7000 8000 9000 10000 11000 Quantity (cars per day) Based on the News Wire, a. What is the initial…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Essentials of Economics (MindTap Course List)EconomicsISBN:9781337091992Author:N. Gregory MankiwPublisher:Cengage Learning
Economics (MindTap Course List)EconomicsISBN:9781337617383Author:Roger A. ArnoldPublisher:Cengage Learning
Economics Today and Tomorrow, Student EditionEconomicsISBN:9780078747663Author:McGraw-HillPublisher:Glencoe/McGraw-Hill School Pub Co
Managerial Economics: A Problem Solving ApproachEconomicsISBN:9781337106665Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike ShorPublisher:Cengage Learning
Essentials of Economics (MindTap Course List)
Economics
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:Cengage Learning
Economics (MindTap Course List)
Economics
ISBN:9781337617383
Author:Roger A. Arnold
Publisher:Cengage Learning
Economics Today and Tomorrow, Student Edition
Economics
ISBN:9780078747663
Author:McGraw-Hill
Publisher:Glencoe/McGraw-Hill School Pub Co
Managerial Economics: A Problem Solving Approach
Economics
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Cengage Learning