4.MTR runs crowded trains [200 passengers per car] at rush hours, but relatively empty trains [25 passengers per car] at off peak hours. Dr. Smart makes the following argument:
“The cost of running a car for this line is $500, regardless of the no. of passengers. So the per passenger cost is about $2.5 at rush hour, but rises to $20 per passenger in off hear hour. Consequently, we had better discourage off peak hour business.”
Do you agree with Dr. Smart? Why or why not?
Thx.