Use the following to answer questions:
Table: The Market for Taxi Rides
-(Table: The Market for Taxi Rides)Use Table: The Market for Taxi Rides.If a government quota limit at 6 million rides is imposed,the quota rent accruing to the owner of a taxi licence will be _____ per ride,but there will be a total missed opportunity (inefficiency)to consumers and producers of _____ million rides.
A) $1;1
B) $2;2
C) $3;3
D) $4;4

Question

Use the following to answer questions:
Table: The Market for Taxi Rides 
-(Table: The Market for Taxi Rides)Use Table: The Market for Taxi Rides.If a government quota limit at 6 million rides is imposed,the quota rent accruing to the owner of a taxi licence will be _____ per ride,but there will be a total missed opportunity (inefficiency)to consumers and producers of _____ million rides.
A) $1;1 
B) $2;2 
C) $3;3 
D) $4;4

Quizplus · Accepted Answer

- The quota rent accruing to the owner of a taxi license will be $4 per ride [(price with quota limit of 6 million rides - price without quota limit)/2].
- There will be a total missed opportunity (inefficiency) to consumers and producers of 4 million rides [the difference between the quantity demanded and supplied at the quota limit of 6 million rides].

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