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A 50-year old bridge at the border is congested. Average crossing times are 30-45 minutes longer than necessary and excessive vehicle idling creates pollution. Government

A 50-year old bridge at the border is congested. Average crossing times are 30-45 minutes longer than necessary and excessive vehicle idling creates pollution. Government is considering a new bridge. The existing bridge is conveniently located, while the new bridge will increase driving distances by at least 15 minutes.

(a) Using an appropriate model(s) explain whether toll charges should be used on these bridges to manage the division of traffic over the two crossings.

(b) You have been hired to undertake a public benefit-cost analysis of the economic feasibility of this new bridge. Describe your method and five issues that could impact the accuracy of your work.

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