The example about London's congestion problem illustrates which of the following economic ways of thinking?
A) isolate variables-ceteris paribus
B) use of assumptions to simplify
C) thinking at the margin
D) all of the above

Question

Quizplus · Accepted Answer

The example about London's congestion problem involves isolating variables by examining the effects of congestion charges and public transportation options while holding other factors constant (ceteris paribus). Assumptions are also used to simplify the analysis, such as assuming that the demand for driving is relatively inelastic. Finally, thinking at the margin is evident in considering the costs and benefits of each additional trip taken and how that relates to congestion and the use of public transportation. Therefore, all of the above economic ways of thinking are relevant to the example.

The Example About London's Congestion Problem Illustrates Which of the Following