Calculate the new equilibrium rent curve

Reference no: EM132473329

Consider the following version of Monocentric city model. Each worker consumes ? acre land across all locations, and its bid rent for one acre of land is ??(?) = 2100 - 50? where ? is measured in km. Agricultural rent is $100 per acre. (Assume for simplicity that there are no firms and developers, but that each worker still commutes to the city centre.) The city builds new highway system and this reduces transportation costs for workers by half. The city is a closed city. Calculate the new equilibrium rent curve.

Reference no: EM132473329

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