Question

Asked Oct 29, 2019

66 views

Think about the market for parking spaces in downtown LA. There is little flexibility in terms of changing the number of parking spaces provided. On the other hand, there are many substitutes for parking in the city such as taking the train or parking just outside the city and taking a bus.

a. Please draw the market for parking spaces in downtown LA.

b. If a tax is applied on parking spaces, what happens to the quantity?

c. Who pays most of the tax burden?

Step 1

a.

When the demand for the parking lot is high in the town and the availability of the parking slots are very limited, it would result in the higher price for parking in the town. This is due to the fact that the equilibrium price in the market is determined at the intersection of the demand and supply curves in the economy. This can be illustrated as follows:

Step 2

b.

When there is tax imposed on the parking lots, it will increase the cost of parking lots in the market. When there is increased price for the parking lot, consumers would go for the substitutes available in the economy. Since there are substitutes such as the parking outside town and taking public transports, people would go for the substi...

Tagged in

Q: the long run average total cost curve's minimum intersects what on the short run cost curve?

A: The long run average total cost curve's minimum intersects with the minimum of short run average cos...

Q: Consider an economy in which the demand for money is of the formMt =(1/v) PtY for t = 0, 1, 2...

A: To determine why the inflation rates differ in the two situations.

Q: Consider the following game. There are two payers, Player 1 and Player 2. Player 1 chooses a row (10...

A: The game theory is the mathematical subsidiary which helps to study the strategic information among ...

Q: i need help with question 1

A: The indifference curve represents different combinations of goods that can be consumed by a consumer...

Q: suppose that the election of a popular candidate suddenly increases people’s confi- dence in the fut...

A: The aggregate demand curve is defined as the sum total of all expenditure in the economy. The increa...

Q: Hello! Can you help me with the question below? An econometric study found that the income elastici...

A: Income Elasticity is defined as the percent change in quantity demanded which is divided from the pe...

Q: 100 90 80 70 60 ATC 50 40 30 20 AVC МС О 10 + 0 0 5 10 15 20 30 35 40 45 50 QUANTITY (Thousands of s...

A: Since we only answer 1 question out of two, we’ll answer the first. Please resubmit the question and...

Q: When is it inappropriate to use monetary and fiscal policy to stimulate or stabilize the economy? pl...

A: The monetary policy is the policy of the central bank which is the apex monetary authority of the ec...

Q: Find the values of x1 and x2 where the following two constraints intersect. (Round your answers to 3...

A: Here, the first step is to simplify the inequalities: therefore, the equation (1) can be written as ...