Characteristics of a common resource, Taxation

Assignment Help:

Suppose there are 40 commuters in Apple Valley, Minnesota who commute to downtown Minneapolis. They have two options for getting downtown: they can take the light rail or they can drive their own car. It takes 25 minutes to get downtown on the light rail, while the time it takes to drive depends on how many other commuters are on the road. Suppose the commute time is (5 + n) minutes where n is the number of commuters on the road (the only people who use the highway are the residents of Apple Valley). Assume workers care only about their commuting time, and the cost of driving is the same as the cost of light rail.

The highway during rush hour is a common resource. What are the two characteristics of a common resource?


Assume the commuters make their decisions about whether to drive or take the light rail independently. How many commuters do you expect to see on the road? What is the total commuting time for all 40 commuters combined in this equilibrium?

If only 10 commuters take the highway the total commuting time for all 40 commuters combined is 900 minutes. Why is this outcome most likely unsustainable if drivers make their decisions independently?


Related Discussions:- Characteristics of a common resource

Prepare the journal entries necessary at december 31, The Diamond Glitter C...

The Diamond Glitter Company is in the process of preparing its financial statements for 2012. Assume that no entries for depreciation have been recorded in 2012. The following info

What is the tax savings from the special tax treatment?, If Daniel's margin...

If Daniel's marginal tax rate is 35 percent and he has $115,200 of other capital gains (taxed at 15 percent), what is the tax savings from the special tax treatment? Daniel is c

Principles of business taxation 2013 edition, Hi, I need help with a timed...

Hi, I need help with a timed quiz based on principles of business taxation 2013 edition . it is 25 short questions in 3 hours.

Sales tax, I got confused with the numbers on these parts: 1. "The $3,600 o...

I got confused with the numbers on these parts: 1. "The $3,600 of property taxes for the house in Orlando were prorated with $1,950 being apportioned to the seller and $1,650 being

Capital gains tax, Joe Smyth further advises you on the following transacti...

Joe Smyth further advises you on the following transaction - work out the resultant capital gains tax consequences.  Then calculate Joe's net capital gain for the 2010/11 income

Taxation Accounting - Capital gains tax (CGT), Critically Evaluate overseas...

Critically Evaluate overseas experiences with this form of tax. (e.g. UK or Australia)

Calculate tax liability, Tax Liability Calculation Morgan (age 45) is singl...

Tax Liability Calculation Morgan (age 45) is single and provides more than 50% of the support of Rosalyn (a family friend), Flo (a niece, age 18), and Jerold (a nephew, age 18). Bo

Wct, How to raise an invoice with WCT for Civil construction job

How to raise an invoice with WCT for Civil construction job

Advanced tax, The Madison Restaurant was formed a S corporation at the end ...

The Madison Restaurant was formed a S corporation at the end of last year. Bob Buron, owns 60% of the stock, manages the restaurant. Ray Huges owns the remaining 40%

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd