12. The city of Animaltown plans to build a new bridge across the river separating the two...

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12. The city of Animaltown plans to build a new bridge across the river separating the two halves of the city for use by its residents. It is considering two plans for financing this bridge. Plan A calls for the bridge to be paid for out of tax revenues, allowing anyone to freely use the bridge. Plan B calls for imposing a toll of $6 for crossing the bridge, with the remainder of the cost to be paid out of tax revenues. City planners estimate a local demand curve for hourly use of the bridge to be Q  1,800  100P. The bridge will be able to accommodate 2,000 cars per hour without congestion.

Which of the plans is more efficient, and why? How would your answer change if congestion was predicted on the bridge?

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