Question 4 Is in your textbook, Ch. 7 Appendix, Applying the Concepts # 1: Suppose the marginal benefit and cost of the high-income households shown in the Figure below (Fig 7A-2 in your book) are relevant for Detroit. In contrast, high-income households in Paris take 50% more trips to the city center (for work and cultural opportunities). While Detroiters commute in air-conditioned land yachts, Parisians pack into mass transit making the unit cost of travel one-third higher in Paris. Use a graph like Figure 7A-2 to predict where high-income Parisians live. Question 5 Assume there are four people in a city. Person A owns one parking lot worth $1,000, person B owns a parking lot worth $2,000, person C owns a small garden worth $12,000 and person D owns a cottage worth $70,000. They want to finance a public the city center. Hint: How does conventional consumer substitution affect the shape of the housing-price curve and how would contrary consumer substitution affect the shape? Question 4 Is in your textbook, Ch. 7 Appendix, Applying the Concepts # 1: Suppose the marginal benefit and cost of the high-income households shown in the Figure below (Fig 7A-2 in your book) are relevant for Detroit. In contrast, high-income households in Paris take 50% more trips to the city center (for work and cultural opportunities). While Detroiters commute in air-conditioned land yachts, Parisians pack into mass transit making the unit cost of travel one-third higher in Paris. Use a graph like Figure 7A-2 to predict where high-income Parisians live. Question 5 Assume there are four people in a city. Person A owns one parking lot worth $1,000, person B owns a parking lot worth $2,000, person C owns a small garden worth $12,000 and person D owns a cottage worth $70,000. They want to finance a public children’s zoo, a local public good. The zoo will cost $20,000 and should be financed by a property tax with equal tax rates per property value. Calculate the tax rate (in %) for the following…