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4. (10 points) Refer to your answer in Question 3. Suppose that MTA plans to increase the subway single ride fare by an additional 10%
4. (10 points) Refer to your answer in Question 3. Suppose that MTA plans to increase the subway single ride fare by an additional 10% due to high inflation in an economy. Based on the outcomes of elaborated data analysis, the government of NYC estimates the average hourly wage also increases 20% due to the inflation but the daily subway ridership does not change. Assume all values of the price elasticity of demand, income elasticity of demand, and cross-elasticity of demand stay the same as the ones in your answer to Question 3. How did the government of NYS estimate that the express bus single ride fare would change? Answer either increase or decrease with an exact number as percent. Also, show your reasoning. (Without reasoning, no points will be given.)
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