Question

True, false or uncertain? Justify your response to each of the following statements.

b) Covid-19 has reduced the fraction of people who commute and, with more companies shifting their employees to work from home more often, this reduction can be expected to persist even if there is no change in the number of jobs in the city. Fewer commuters on the road reduces the cost of commuting for the people who do commute. Suppose that the shift in the cost of commuting is proportional to percentage reduction in the fraction: e.g. if there are 25 percent fewer commuters then the cost of commuting drops by 25 percent. The change in commuting would have no effect on the optimal size of a city, and it would decrease the equilibrium size of a big city and increase the size of some small cities.

Answer 1

True : Assuming that we have size of th city means taking only commuters in consideration In the given situation as the number of commuter is in proportionality with the reduction in the fraction of commuter so it may not have the effect on the optimal size but , if the city size is big then the commuter will be more and if more fewer commuter will be then more pecentage reduction in the fraction .while inc ase of small city fewer commuter will increases causing less reduction as comapred to big city .That is why we can say that the equilbirum size of the city decreases by the change in commuting and the increased small city size .Hence the statement is true considering the above facts .

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