Answer Both Parts of the Following Question

question 96

Essay

Answer both parts of the following question.
a. The San Francisco Chronicle reported that the toll on the Golden Gate Bridge was raised from $2 to $3. Following the toll increase, traffic fell by 5 percent. Based on this information, calculate the point price elasticity of demand. Is demand elastic or inelastic? Explain.
b. Stephen Leonoudakis, chairman of the bridge's finance auditing committee, warned that the toll increase could cause toll revenues to decrease by $2.8 million per year. Is this statement consistent with economic theory? Explain.

---

Definitions:

Action Potentials

Short-lasting events in which the electrical membrane potential of a cell rapidly rises and falls, allowing neurons to transmit signals along nerve fibers.

Cohort Differences

Variabilities or distinctions observed between defined groups of individuals, often distinguished by their age, generation, or shared experiences.

Age-related Variation

Differences in behavior, physiology, or characteristics among individuals of different ages, often due to developmental processes or aging.

Adult Intelligence

The cognitive ability of an adult, encompassing aspects such as logical reasoning, problem-solving skills, and the capacity to understand complex concepts.