Question content area left

Part $1$

Gas Prices and Public Transit Ridership.

Part $2$

Consider the effect of higher gasoline prices on public transit ridership. The initial price of public transit is$$ $$3\mathrm{.}00$ per ride and the initial ridership is$100,000$ people per day. Suppose the elasticity of transit ridership with respect to the price of gasoline is$+0\mathrm{.}667($or$2/3)$ and the price of gasoline increases by $30$ percent.

Part $3$

a$.$ Assume the price of public transit remains at$$ $$3\mathrm{.}00.$

The increase in the gas price will

Part $4$

A$.$

cause a movement along the transit ridership demand curve.

B$.$

shift the transit ridership demand curve to the right.

C$.$

shift the transit ridership demand curve to the left.

D$.$

shift the gasoline demand curve to the left.