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(civl362)[2008](f)quiz2&3~PPSpider^_10080.pdf
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CIVL 362 Transportation System Operations
Tutorial Quiz 2&3 (Suggested Solution)
Name: Student ID: Week 2, 17 Sep 2008
1.
A transit authority wants to improve one segment of a light rail system by increasing the peak-hour seating (capacity) by 20% and also by setting the fare to achieve full utilization (load factor =1). The existing capacity is 2000 seats/hour with fare rate $1/seat, and the price elasticity is -0.75 by previous case study. What additional consumer surplus would be generated by this action? Would the transit authority gain from this action?







Remark: In this problem, assume the transit authority is a private company, its gain or not is only evaluated from the point of revenue. If it is a government department, the consumer surplus would be considered as priority.