problem 1. Think about the market for parking spaces in downtown LA. There is little flexibility in terms of changing the number of parking spaces provided. On the other hand, there are many substitutes for parking in the city such as taking the train or parking just outside the city and taking a bus. a. Please draw the market for parking spaces in downtown LA. b. If a tax is applied on parking spaces, what happens to the quantity? c. Who pays most of the tax burden? problem 2 Suppose the California legislature passed a sweeping law to lower the number of regulations for building homes such as increasing the parking requirements and setback requirements. Suppose there is a housing tax. a. What is the effect of this law on the PES for housing? b. What effect would this law have on the tax burden for buyers?
problem 1. Think about the market for parking spaces in downtown LA. There is little flexibility in terms of changing the number of parking spaces provided. On the other hand, there are many substitutes for parking in the city such as taking the train or parking just outside the city and taking a bus. a. Please draw the market for parking spaces in downtown LA. b. If a tax is applied on parking spaces, what happens to the quantity? c. Who pays most of the tax burden? problem 2 Suppose the California legislature passed a sweeping law to lower the number of regulations for building homes such as increasing the parking requirements and setback requirements. Suppose there is a housing tax. a. What is the effect of this law on the PES for housing? b. What effect would this law have on the tax burden for buyers?
Chapter5: Supply, Demand, And Price: Applications
Section5.11: Application 11: College Super Athlets
Problem 1ST
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problem 1. Think about the market for parking spaces in downtown LA. There is little flexibility in terms of
changing the number of parking spaces provided. On the other hand, there are many substitutes for
parking in the city such as taking the train or parking just outside the city and taking a bus.
a. Please draw the market for parking spaces in downtown LA.
b. If a tax is applied on parking spaces, what happens to the quantity?
c. Who pays most of the tax burden?
problem 2
Suppose the California legislature passed a sweeping law to lower the number of regulations for
building homes such as increasing the parking requirements and setback requirements.
Suppose there is a housing tax.
a. What is the effect of this law on the PES for housing?
b. What effect would this law have on the tax burden for buyers?
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