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The municipal corporations in most parishes 1n Jamaica have initiated a program to charge residents for garbage disposal based on the number of cans filled
The municipal corporations in most parishes 1n Jamaica have initiated a program to charge residents for garbage disposal based on the number of cans filled per week. The parish of Kingston decided to increase its per can price from $500 to $750 per week. In the first week,_ 1t was found that the number of cans that were brought to the curb fell from 500 to 450 (although the workers complained that the cans were heavier). The chief economist ran the numbers, informed the mavor that the demand for disposal was inelastic, and recommended that the price be raised to maximize town revenue from the program_ Four months later, at a price of 31000 per can, the number of cans has fallen to 125 and town revenues are down. What might have happened? [ marks | 3
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