Microeconomics 6th Edition by Robert Hall, Shirley Kuiper, Marc Lieberman

Exercise 1

In the chapter,we calculated the likely long-run change in revenue if New York City were to raise mass transit fares from $2.25 to $2.70. Use the same procedure to calculate the short-run impact of this fare hike. This time,use an elasticity of 0.35,which is in the middle of the short-run estimates in Table 1.
Table 1
Sources: Molly Espey (1996)"Explaining the variation in elasticity estimates of gasoline demand in the United States: A meta-analysis," The Energy Journal 17(3): 49-60; Phil Goodwin,Joyce Dargay,and Mark Hanly (2004)"Elasticities of road traffic and fuel consumption with respect to price and income: A review," Transport Reviews 24(3)275-292; ESRC Transport Studies Unit,University College London (www.transport.ucl.ac.uk); Mark A. Bernstein and James Griffin (2005)Regional differences in the price-elasticity of demand for energy ,National Renewable Energy Laboratory/ RAND Corporation; John C.B. Cooper (March 2003)"Price elasticity of demand for crude oil: Estimates from 23 countries," OPEC Review: Energy Economics Related Issues (27)1; Todd Litman (2004)"Transit price elasticities and cross-price elasticities," Journal of Public Transportation 7(2).