Benefits for transferring drivers to transit, Business Economics

Assignment Help:

Distribution of benefits for transferring drivers to transit during a congested morning commute

A residential suburb has N = 30,000 commuters who drive alone to jobs in a central business district (CBD) with uniformly distributed desired arrival times to the CBD from 8:00am to 9:00am. All car traffic must cross a bridge with limited capacity μ = 20,000 veh/hr to enter the

CBD, but road capacity upstream and downstream can be assumed sufficient to serve demand without delay. Assume that all commuters value their time of delay at β = 30 $/hr, and that the out-of-pocket cost of driving a car is cd = $4 per trip.

A. Initially, the only way to get to work is by car. Using Vickrey's model of the morning commute with earliness time valued at ½ the rate of queuing delay (e = 0.5) and lateness time unacceptable (L = ∞), draw to scale a queuing diagram for a typical day. Show on it the maximum queuing delay, and the maximum earliness. (Note: free flow travel time can be ignored; explain why.) What is the average generalized cost per commuter? The city government is considering starting a high-speed ferry service to relieve congestion and reduce the cost of the morning commute. How many commuters (n), uniformly distributed between 8:00am to 9:00am, must be diverted to the ferry to eliminate the delay caused by the bridge bottleneck?

B. Write an expression of the generalized cost per passenger in terms of the ferry ship's scheduled headway h << 1 (hrs/trip), the prorated cost per commute period for the ferry terminal infrastructure cf ($/period) and the variable cost per revenue ferry trip cv ($/trip) (Assume: fares reflect the ferry's costs; the ferry carries the n commuters identified in part A; a ferry trip excluding the waiting delay takes the same amount of time as a car trip exclusive of the bottleneck delay; headway are so short that people do not bother checking the schedule; and the number of seats on the ferry always exceeds the demand.)

C. What h* minimizes the average ferry rider's generalized cost if cf = 20,000 $/period, cv =

2,000 $/ trip, and all the costs of ferry operation are passed on to ferry riders as fare? What is the average generalized cost to each ferry rider, and how does it compare to the average cost to each driver on the now uncongested bridge? Who is better off? What is the average generalized cost per commuter (averaging across ferry riders and drivers)?

D. Could the solution of part C be an equilibrium solution if commuters were free to choose their transportation mode? If your answer is "no", suggest a revenue-neutral toll and ferry fare policy that would achieve the solution we have assumed, and discuss the role of crosssubsidies.

E. Extra credit: Determine whether the average generalized cost across all commuters could be reduced by changing n.


Related Discussions:- Benefits for transferring drivers to transit

What are the economic reasons for protectionism, QUESTION (a) Discuss w...

QUESTION (a) Discuss whether international trade between countries is always beneficial. (b) What are the economic reasons for protectionism? (c) Does the National Income

Job Creation, How much power or influence does a U.S. President versus a CE...

How much power or influence does a U.S. President versus a CEO actually have when it comes to job creation or the choice to manufacture company goods in a foreign nation?

MGT285, Ask quWhich one of the following is TRUE? a. Small changes in t...

Ask quWhich one of the following is TRUE? a. Small changes in the annual growth rate amount to a measurable difference in the long-term growth trend of a country. b. For ev

What are the factors of evaluating a policy or institution, What are the fa...

What are the factors of evaluating a policy or institution? Factors to consider during evaluating a policy or institution comprise: • Internal and external constraints onto

How external trade promote economic development and growth, How can externa...

How can external trade promote economic development and growth? International trade permits increased specialisation than higher output permits economies of scale. • A big m

Determine the total price effect , An agent has a utility function over goo...

An agent has a utility function over goods 1 and 2 of the form U = x c 1 x d 2 where c is your 1- digit number and d is your minimum number. The agent's income is equal to you

Can less developed countries grow by secondary sector, Can economies grow o...

Can economies grow of less developed countries by developing its secondary sector? Economies grow of less developed countries by developing its secondary sector because manufac

What is import substitution, What is import substitution? Import subst...

What is import substitution? Import substitution: It is a government industrialisation policy for development by replacing imports along with domestic production. St

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