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Beta Car Services is the only transportation provider in a midsized county, about 65 miles outside of a major city. Licensed by the local government, the firm provides door to door service between the residents' homes, the train station (which connects to the major city), local retail stores, and other key locations within and surrounding the town center. To access the service, residents may call for a specific pick-up time, or they could wait by any curb for an unscheduled curbside pick-up. The market demand for transportation services is described by the equation: P = 12 - 0.025Q, where Q is the number of trips per day. With regular maintenance on its fleet of vehicles as well as outstanding loan payments, the firm faces a daily fixed cost of $100. Beta Car Services'labor force includes drivers and dispatchers, and all report to work if the firm is providing service. Along with the labor force and the necessary materials needed for day-to-day operation, the firm's additional costs can be described by the equations: MC = 3 + 0.05Q and AVC = 3 + 0.025Q where Q is the number of trips per day. Now consider that after much lobbying and quiet protests from the county residents about unfavorable service (delays, being stranded, etc), the local government removes restrictions in this market and other car services can enter the market. After the government's actions, the market adjusts; Beta Car Services remains dominant in the market and the new car services in the market are highly competitive. The residual demand is P = 9 - 0.0125Q and the competitive supply is MC = 9 + 0.025Q. 4. What can be said about the market outcome after the government's decision? (24 points) Complete the sentence by entering one of the following phrases or a numerical value (0.00 is acceptable) in the blank spaces provided: in the 1st blank space: a numerical value in the 2hid blank space: a numerical value in the 3"d blank space: profit | loss in the 4th blank space: decreased to | increased to | remains the same at in the 5th blank space: a numerical value in the 6th blank space: a numerical value in the 7th blank space: a numerical value in the 8th blank space: a numerical value in the 9th blank space: A = better off compared to | no better or worse off compared to | worse off compared to in the 10th blank space: a numerical value As a result of the government's decision, Beta Car Services now provides trips per day and charges $ for each trip. Now, Beta Car Services economic has The new service providers use their private cars and typically provide 5 trips per day and charge $ for each trip. As a result, there are new service providers and the total market quantity is trips per day. Furthermore, consumers are before the government's action. After the government's action, consumers surplus is $
