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Question: Assume that your probability of surviving an accident is greater in a car equipped with certain safety features. If so, what will be the likely effect on the number of accidents? Give a numerical example showing that the safety requirement might actually increase injuries or deaths, and relate your work to the concept of demand elasticity. Now assume no safety features, but instead assume that the government requires every car to be equipped with a dagger in the center of the steering wheel, pointed at the driver. Do you expect that this will reduce injuries or deaths by more than safety equipment? Explain.

Microeconomics, Economics

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