Ch.5

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Based on the following information, determine the location quotient for Music City and whether this city has a competitive advantage in the entertainment industry: employment in entertainment in Music City: 3,020; total employment in Music City: 656,785; employment in entertainment (nationally): 2,160,970; total employment (nationally): 106,201,232.

0.23; No, the city does not have a competitive advantage in this industry.

A recent college graduate has obtained employment at a major financial institution in the big city. Since she just graduated, she has decided to continue to rent her college apartment in the suburbs and make the daily commute to the big city for work. She currently pays $1,000 per month to rent an apartment in the suburbs. She works at the bank five days a week and it takes her one hour each way to commute from her home to her office. According to the assumptions of the bid-rent model, what should this recent grad be willing to pay in rent per month to live in the big city if her hourly wage rate is $20? (In your calculations, assume there are four weeks in a given month.)

1,800

Using the following information, determine the location quotient for this industry: percentage of employment in financial services industry within the local community: 15%; percentage of employment in financial services industry for the entire United States: 4.4%.

3.4

Using the following information, determine the location quotient for Springfield: employment in aerospace products within Springfield: 30,044; total employment in Springfield: 208,054; employment in aerospace products (nationally): 474,905; total employment (nationally): 106,201,232.

32.29

An individual works downtown and pays $600 per month in rent for an apartment located 10 miles from her office. She has calculated that she spends 30 minutes per day driving each way to the office and it costs her $4 per day in gas and lost productivity. Using the framework of the bid-rent model, how much would she be willing to pay for an apartment downtown, assuming a 20 workday month?

680

A new faculty member at the local university pays $1,500 per month to rent an apartment in the downtown area. She teaches on campus three days a week and works from home the remaining two days. On the days when she must commute, given the heavy traffic congestion, it takes her two hours each way to commute from downtown to campus. According to the assumptions of the bid-rent model, what should this professor be willing to pay in rent per month to live near campus if her hourly wage rate is $25? (In your calculations, assume there are four weeks in a given month.)

With 4 weeks in a month, there are 3 x 4 = 12 days for teaching and 2 x 4 = 8 days for work from home in a month. When commuting a total of 4 hours a day are needed. This cost him $25 x 4 = $100 per day in lost earnings and a total of $100 x 12 = $1200 as lost earnings for a month. Currently he pays $1500 per month to rent an apartment. Thus the total amount he is willing to pay in rent per month to live near campus is $1500 + $1200 = $2700 Answer: $2700

According to the bid-rent model, which of the following individuals would be the one most likely to live closest to the central business district (CBD)? (Hint: Assume that work locations are located adjacent to each other at the center of the CBD.)

a doctor at the city hospital who must walk to work

An early model of land use is the concentric ring model of urban form developed by E.W. Burgess. Of the following land uses, which would be closest to the downtown area of the central business district (CBD) according to Burgess's model?

a zone of transition that contains warehousing and other industrial land uses between the downtown area and the residential area

Cities such as New York are able to host a variety of complex industries because of the development of specialized resources that support their growth. When specialized resources emerge in response to demand from multiple industries, this is referred to as

agglomeration economies.

Within the framework of the bid-rent model, as rents increase with proximity to the central business district (CBD), the tendency is for development to

build upward on lots within the CBD to allow multiple tenants.

Providers of convenience activities find it profit-maximizing to disperse over the region of potential customers to the point where each establishment is equidistant from another and is separated by the minimum distance that allows sufficient customers to support each establishment. The resulting pattern of establishment locations is referred to as

central place pattern

Because a city's output capacities change slowly over time, it is important to understand the supply-side (long-run) factors affecting urban growth. Which of the following would not be considered a supply-side factor that impacts a city's economic growth?

city's export activity

Six suburban office buildings have been constructed along six consecutive blocks in Roseland, New Jersey. This is an example of

clustering

A city's economic base can be viewed in terms of a multiplier process, in which the money that is brought in through export activities is then respent within the city. Which of the following economic activities is the least likely to be considered a high-impact or high-multiplier economic base activity?

computer assembly

A city's potential for growth or its susceptibility to decline is determined by a set of economic activities that the city provides for the world beyond its boundaries. Economists refer to this set of activities as a city's

economic base

A fishing company was formed in Juneau, Alaska. Over the next decade, a canning plant, a processing plant, and a boat repair facility also opened in Juneau. This is an example of

industry economies of scale.

The growth of the motion picture industry in Los Angeles, the petrochemical industry in Houston, and the software industry in Silicon Valley are all examples of how the growth of an industry within a city can create cost advantages for future growth. Economists refer to this phenomenon as

industry economies of scale.

In contrast to base activities, local economic activities (or secondary activities) serve the local business and households that are recirculating the income derived through the city's economic base. In other words, we can distinguish local economic activities from export activities by thinking about whether or not the activity brings money into the city from outside sources. Which of the following activities is not an example of land use for local economic activity?

manufacturing center

Which of the following models of urban form is characterized by radial corridors or wedges representing the pattern of residential land use in relation to the location of the central business district (CBD)?

sector model

Within some types of land use, business location may be determined by the type of service or products that are offered to consumers. Based on your understanding of the differences between comparison and convenience activities, which of the following providers would operate in the convenience activity space?

supermarket


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