he city of Lansing has built a new bridge across the river separating parts of the
city for use by its residents. It is trying to decide whether to impose a toll and, if so, how much
to charge; it would need to collect $28,000 per hour to finance the bridge, but if it collects less
than that, it will finance the remainder of the expense from general tax revenues. City planners
estimate a local demand curve for hourly use of the bridge to be Q = 2,800 – 100P. The bridge
will be able to accommodate 2,000 cars per hour without congestion. If the cost of collecting a
toll is negligible, is it more efficient to collect a toll or not? If so, how much should Lansing
charge for crossing the bridge?