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Chapter 27: Q. 1- Critical Thinking Questions (page 617)

Why do you suppose that the U.S. Transportation Department has been considering new regulations mandating that states construct parking facilities for trucks?

Short Answer

Expert verified
  • A parking bay with one-way traffic flow is usually narrower than one with two-way traffic flow.
  • Increase on-street (curb) parking, subsidies off-street parking, reimagine current parking facilities, and notify users about parking options.

Step by step solution

01

Introduction.

The Department of Transportation is in charge of federal transportation project planning and coordination. It also establishes safety standards for all major modes of transportation.

02

Parking facility.

  • One of the most important aspects of parking structure design is determining whether the traffic flow will be one-way or two-way.
  • A parking bay for a one-way traffic flow is typically narrower than one for a two-way traffic flow.
  • The available site dimensions will influence the width of the parking bays, and thus the circulation pattern.
03

Factors used to regulate Parking facility by U.S. Government.

  • Parking Requirements at a Minimum
  • Increase on-street (carriageway) parking.
  • Off-street parking should be subsidized.
  • Insert Remote Parking Spaces.
  • Existing Parking Facilities Should Be Redesigned
  • Mechanical Garages and Car Stackers
  • Users should be given parking information.

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Most popular questions from this chapter

Research into genetically modified crops has led to significant productivity gains for countries such as the United States that employ these techniques. Countries such as the European Union's member nations, however, have imposed controls on the import of these products, citing concern for public health. Is the European Union's regulation of genetically modified crops social regulation or economic regulation?

An years past, firms around the world have secretly engaged in collusive agreements to restrain production and push prices above competitive levels.

Evidence compiled by government officials investigating such agreements has revealed that conspiring firms often utilize similar methods of establishing and enforcing collusive restraints of trade. Most agreements, for instance, assign to each firm an allowed market share, a permitted region of operations, or an approved set of customers. In addition, participating firms commonly are required to exchange sales information so that they can monitor adherence to their agreements to restrain trade. In this chapter, you will learn why firms that typically utilize these techniques to formulate and maintain collusive agreements engage in secret conspiracies: Such agreements are illegal under U.S. antitrust laws.

Recognize the practical difficulties in regulating the prices charged by natural monopolies

The table below depicts the cost and demand structure a natural monopoly faces.

a. Calculate total revenues, marginal revenue, and marginal cost at each output level. If this firm is allowed to operate as a monopolist, what will be the quantity produced and the price charged by the firm? What will be the amount of monopoly profit? [Hint: Recall that marginal revenue equals the change in total revenues (P×Q)from each additional unit and that marginal cost equals the change in total costs from each additional unit.]

b. If regulators require the firm to practice marginal cost pricing, what quantity will it produce, and what price will it charge? What is the firm's profit under this regulatory framework? [Hint: Recall that average total cost equals total cost divided by quantity and that profits equal (P-ATC)×Q.].

c. If regulators require the firm to practice average cost pricing, what quantity will it produce, and what price will it charge? What is the firm's profit under this regulatory framework?

Why do you suppose that nearly all of the world's antitrust authorities agree that collusive conspiracies to restrain trade and fix prices are illegal?

Do you think that the regulation described in Problem 27-6 is more likely an example of the capture hypothesis or the share-the-gains, share-the-pains theory? Why?
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