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Suppose one were asked to recommend a price for the output of a proposed downtown parking garage, so that the project would have as large a Net Present Value as possible. In this case, the optimal parking price or rate is the one for which the last person's willingness to pay for parking will exactly equal that person's marginal cost of parking, including the opportunity cost of that person's time.
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Describe Willingness to Pay?
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why men and womens indifference curves are different
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Demonstrate mathematically that the equilibrium condition MRS PB PA is the equivalent of the utility-maximizing rule MU AP A MU B PB .
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