Additional Application For the First Seven Months of 2006 Stockholm,Sweden Has Been

Additional Application
For the first seven months of 2006 Stockholm,Sweden has been testing a possible solution to the city's traffic congestion.It is called "congestion pricing" and their system includes "small transponder boxes,laser detectors and a network of cameras to track the path of every car…" They want to reduce problems associated with smog and gridlock and,in turn,improve the quality of life.
The experiment recorded each car's registration,the date and time of day,as it passed through specific electronic tolls and calculated a fee that was charged to the car's owner.During the rush hour the fee could be as high as $2.75.But in the evenings the toll would be zero.The expectation is that people will respond to these varying tolls,change their driving habits to be more efficient,and take more public transportation.
The next step is to put a referendum to the voters to decide whether this system will become a permanent feature in the life of Stockholm drivers.
Leila Abboud and Jenny Clevstrom,"Stockholm's Syndrome: Hostages to Traffic,Swedes Will Vote on High-Tech Plan To Untangle Snarls With Tolls," Wall Street Journal,August 29,2006,http://infoweb.newsbank.com,accessed 11/22/06.
-As the cost of driving during specific times increases,people will drive less during those times.This supports the basic economic notion that:

A) supply equals demand.
B) people respond to incentives.
C) marginal returns will diminish.
D) people are irrational.

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