Suppose that the apartment building you live in at college has only one water meter for the entire building. The landlord receives a water bill from the city each quarter based on the gallons of water used, but each apartment or tenant is not charged separately – the cost of water effectively is included in the rent. Now the water department decides to install separate meters for each apartment and to bill each separately rather than the landlord (so the rent is reduced by $X per person for all tenants). The city justifies the cost of the extra meters and billings on the grounds that the city’s scarce water resources will be used more efficiently. What is the price to a tenant or apartment per gallon of water before and after the new meters are installed? Do you think the new procedure will reduce water use? If so, how might the student tenants of these apartments act to conserve water? Will there be a gain in economic efficiency?