星期五, 11月 12, 2004

I have the following puzzles

I know that both air travel service(3 hours flight) and trains (36 hours on rails) are operating currently between HKSAR and Beijing.
Suppose that under the following circumstances :

  • (a) the general real wage rate of the HKSAR citizens rises;

  • (b) a fixed departure tax is imposed by the government no matter the HK people travelled by airplanes or trains;

How could you predict the impact on the change of number of travellers using airplanes (air passengers) and railways (rail passengers) from HKSAR to Beijing? (Hint: be resolved by the Law of Demand)


4 Comments:

Blogger tracyluvming said...

(a) it will lead to an increase in quantity demanded since when the real wage rate has increase, the money cost of travelling by aeroplane decrease. whereas the time cost of travelling by train is higher than by plane.


(b) people will then choose to travel by plane since the cost of travelling by plane is relativly lower then by train!

9:05 上午  
Blogger winterchiuckp said...

A) Quantity demanded amd income are positively related. Air service travel is a superior good. As the general real wage rate of the HKSAR citizens rises, the demand of AIR travel service rises.when one's income increases, one buys more superior good to satisfy one's unlimited wants.

If a fixed cost such as transport cost and per unit departure tax, equal to two travel service. As the money price of good - quality commodity rises by a smaller percentage , relative price of good - travelling by air decreases. Since relative price of travelling by air falls and relative price of by train rises, by the law of demand, market share of by air increases.

9:07 上午  
Blogger 6A11 said...

When the general real wage rate of HKSAR citizens rise, that means more ppl are willing and able to affort the air service. Besides, a fixed departure tax on both airplanes and trains would make more ppl choose by airplanes rather than the trains becoz of the time cost. Therefore, the as airplanes and trains are sunstitutes, so the demand of airplanes increase, passengers would increase. On the other hand, the demand and the passengers of trains would decrease.

9:08 上午  
Blogger 6A5 said...

(a)When the general real wage rate of the HKSAR citizens rises,people are willing to travel by air althought it has a higher price.So ,the number of passenger (by air) will increase.then the number of passenger (by Train)will decrease.Because the are sutitudes.

(b)If there are a fixed departure tax by travelling by air or train,the no of passenger by air also increase.
It is because those cost of travelling increase,however the time cost of by train is higher than by air.So ,people are willing to pay a higher price by air but not to travel by train.the demand of travel by air also increase.

8:31 下午  

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