Question: / scraper City has a subway system, for which a one - way fare is $ 1 . 5 0 . There is pressure on
scraper City has a subway system, for which a oneway fare is $ There is pressure on the mayor to reduce the fare by third, to $ The mayor is dismayed, thinking that this will mean Skyscraper City is losing onethird of its revenue from es of subway tickets. The mayor's economic adviser reminds her that she is focusing only on the price effect and ignoring the antity effect.
While the fare decline will negatively affect city revenue through the effect, it will positively affect city revenue through the effect. The overall effect on revenue will be positive if
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