1. Taxi fares in New York recently were increased by nearly 50%. Predict the effect on the price of taxicab medallions, the earnings of taxicab drivers and congestion in New York streets.
2.  In the interest of conservation it has often been argued there must be government regulation of the extraction of natural resources such as timber and government regulation to protect endangered wildlife. Explain why and how, in a free market economy, these resources are already regulated and comment on the pitfalls to either form of regulation.

 Economists Armen Alchian and Reuben Kessel have advanced the hypothesis that monopolists choose to satisfy more of their non-pecuniary aims than do perfect competitors. Consider the following aims: (a) exercising their preferences against certain minorities, (b) enjoying the good life with lush expense accounts for executives. What theoretical arguments could support this hypothesis? How might you test this hypothesis?