Which of the following statements concerning efficiency is correct?
A)If a toll road is heavily used so that traffic movement is slowed, the price per vehicle should be reduced since the road is generating more revenue.
B)Economists advocate high prices for abundant resources and low prices for scarce resources.
C)If a toll road is heavily used and traffic movement is difficult, the price per vehicle should be increased to shift some traffic to less-crowded roads.
D)All of these options are desirable in promoting efficient use of scarce road space.

Question

Quizplus · Accepted Answer

According to the concept of congestion pricing, if a toll road is heavily used and traffic movement is difficult, the price per vehicle should be increased to shift some traffic to less-crowded roads. This not only helps in reducing traffic congestion but also promotes efficient use of scarce road space. Options A and B are incorrect as they do not promote efficiency in this scenario. Option D is incorrect as option A is not desirable for promoting efficiency.

Which of the Following Statements Concerning Efficiency Is Correct