1.Consider a jurisdiction where .Because there are so many residents, the probability of being arrested for committing a crime is only 30%, and the value of the available loot is $200 (per day).This jurisdiction favors harsh sentencing laws, so the cost associated with jail time is equivalent to $100 a day.There are other costs associated with committing a crime, including the cost of criminal supplies and information ($15) and the social cost of being seen as a criminal ($10).

a.Calculate the estimated criminal income.Would a person making $150 per day commit property crime?Why or why not?

b.Graph the legitimate income curve and estimated criminal income curve, given the lowest level of legitimate income is $50 per day, the highest is $300, and the median resident makes $100 per day.(assume a generally linear slope for our purposes)

c.Assume this jurisdiction wants to reduce crime.What would be the effect of increased policing raising the probability of apprehension to 40%?What might you want to consider, besides the reduced crime rate, when selecting a crime-reduction policy?

d.What effect would rising incomes in this jurisdiction have?

2.Examining the transformation curve in the crime chapter, determine your goal for reducing crime and explain what allocation of police you would use to achieve that goal.

3.What are the two reasons to subsidize public transportation?Why might U.S. cities tend to have such poor quality public transportation?