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A bridge over the Coosa River currently has no tolls and an average passage of 880 cars per day. State government wants to place a toll on the bridge with the objective of raising the most revenue. Government surveys indicate that a toll of $7.00 or more will induce all drivers to take a nearby, alternate route. What’s the optimal toll and how much daily revenue will be collected? Show the graph and the proof.

Microeconomics, Economics

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