Research suggested at the time of passage

Assignment Help Microeconomics

Reference no: EM13734577

The 55 mph speed limit was initially imposed as part of the Emergency Highway Conservation Act of 1973. This law has been amended in many states by raising the limit on certain highways.
Research suggested at the time of passage that the reduced speed limit could be credited with saving 7,466 lives per year, reducing fuel use by 3.4 billion gallons of gasoline per year, and reducing injuries by 198,000 per year. The same researchers estimated that drivers spent 3,997 million additional hours on the highway each year as a result of the lower speed limit.
At the time the speed limit was enacted, the price of gasoline was $0.53 per gallon, the average hourly wage rate was $7.50, and the average highway injury cost was $15,504.
a. If the average life saved were valued at $2 million would a cost-benefit analysis conclude that the 55 mph speed limit was admissible in 1973? Why or why not?
b. Many things have changed since 1973. Find current values and identify your source for each of the following: average price of gasoline, average hourly wage rate, average highway injury cost.
c. Increased automobile safety features and fuel efficiency have roughly offset the increase in the number of vehicles since 1973 so assuming the figures found by researchers in paragraph 2 are still valid, what would a life have to be valued at to make the speed limit admissible today?
d. Do you think the 55 mph speed limit should be reinstated? Why or why not?

Reference no: EM13734577

Questions Cloud

Maintenance and insurance-rule of thumb : A “rule of thumb” for automobile owners is that the yearly total costs (maintenance and insurance) for the first five years of operation of a new (i.e., not used) automobile will average roughly 10% of the vehicle’s purchase price.

Write an essay on specific aspect of latin culture : I have a final presentation that can cover any of a specific aspect of Latin culture. Examples: food, drink,holiday,landmark, tourist attraction, art, sport, famous or historical person.

Research three of employers of choice : Identify and research three of your employers of choice and visit their websites. Create a 6 - 8 slide Microsoft PowerPoint presentation identifying and discussing how well each company meets your criteria.

Describe the advantages and disadvantages of the union : Would you seek to acquire a company within the European Union or outside of it. Why. Describe the advantages and disadvantages of the choice you made.

Research suggested at the time of passage : Research suggested at the time of passage that the reduced speed limit could be credited with saving 7,466 lives per year, reducing fuel use by 3.4 billion gallons of gasoline per year, and reducing injuries by 198,000 per year. The same researchers ..

Explain the trip from your personal point of view : explain the trip from your personal point of view, and it should detail your experience. Explain a little of what you learned, but do not list only historical information or detailed time lines.

Oakland is considering alternative ways of providing cable : The City of Oakland is considering alternative ways of providing cable TV service to its residents. Based on an econometric analysis of several recently awarded cable franchises in other cities, economists have determined that the total cost, TC, and..

What are the quality management techniques that portakabin : What are the quality management techniques that Portakabin use. Demonstrate how Portakabin apply them. Explain how Portakabin deals with production quality problems? And analyze how does this contribute with company overall quality

Describe how opening up to trade affects all three factors : Consider two countries (Home and Foreign) that produce goods 1 (with labor and capital) and 2 (with labor and land) according to the production functions described in problems 2 and 3. Initially, both countries have the same supply of labor (100 unit..

User Account

All Pages