Homework

Problem 3. Suppose also that the mayor has many options at their disposal, e.g.,

build additional highways (very costly, necessitating large tax revenues), or build

specialized bicycle paths (more or less costly versions, e.g., even elevated from the

ground), they can spend more money on treating respiratory illnesses and illnesses

related to inactivity, they can subsidize shared driving, or they can impose some costs.

Perhaps some short-term costs may be recuperated in the long run? Additionally, you

can think that if a lazy person starts riding the bicycle more often, they start enjoying

it more, or that an active person driving their car more often might become lazier.

Or there may be vested interests related to promoting one mode of transportation

over another. Of course, there may be also the problem that riding a bicycle very far

might take more time than driving (provided there isn't much trac). You can of

course also consider many other possibilities (e.g., eect of reduced car sales on the

economy...). Come up with an interesting story, thinking as an economist (no right

answer, just a good argument), support it with specic cases and facts, if you can.