A city government is considering renting space in an all day parking garage for its 100 employees. The government estimates these employees' demand function for parking spaces is 150 50P (P 2 $1), where Pis the per-day price of parking, and the city will pass on the cost. (a) If the city needs not charge each of its employees the same price for a parking space, what is the maximum amount the city could pay for the 100 spaces, and what would be the average cost per space? (b) Assume the employees' union insists that – per their contract – each employee must be charged the same price for parking, and the city's response is to intend charging the price that maximizes its parking fee revenue. What price per space would the city charge under this circumstance, and how much less total dollar benefit would the employees receive?

A city government is considering renting space in an all day parking garage for its 100 employees. The government estimates these employees' demand function for parking spaces is 150 50P (P 2 $1), where Pis the per-day price of parking, and the city will pass on the cost. (a) If the city needs not charge each of its employees the same price for a parking space, what is the maximum amount the city could pay for the 100 spaces, and what would be the average cost per space? (b) Assume the employees' union insists that – per their contract – each employee must be charged the same price for parking, and the city's response is to intend charging the price that maximizes its parking fee revenue. What price per space would the city charge under this circumstance, and how much less total dollar benefit would the employees receive?

Name: A city government is considering renting space in anall day parking g
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Description: A city government is considering renting space in anall day parking garage for its 100 employees. Thegovernment estimates these employees' demandfunction for parking spaces is 150 5ÓP (P > $1), wherePis the per-day price of parking, and the city wil

A First Course in Probability (10th Edition)

10th Edition

ISBN:9780134753119

Author:Sheldon Ross

Publisher:Sheldon Ross

Chapter1: Combinatorial Analysis

Section: Chapter Questions

Problem 1.1P: a. How many different 7-place license plates are possible if the first 2 places are for letters and...

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