Final answer:
The average income of a city is likely to be influenced by new economic policies, as such policies shape economic activities and growth, affecting incomes, although not always translating to a higher standard of living.
Step-by-step explanation:
Yes, the average income of a city can be affected by the implementation of a new economic policy. Economic policies can have a variety of impacts on a city's economy, which in turn can influence average incomes. For example, a tax cut on income may increase disposable income for citizens and stimulate economic activity in the short-term, while government spending on infrastructure like roads and bridges may lead to long-term economic growth through improved efficiency and productivity. On the other hand, some policies might not result in a clear benefit to the standard of living; for instance, an increase in GDP due to spending on crime prevention measures or post-disaster reconstruction doesn't necessarily equate to an enhanced standard of living. Similarly, in industries such as the taxicab industry, significant economies of scale could exist in large cities due to the high demand and cost distribution over a large number of services rendered. Finally, issues like extreme levels of pollution can have detrimental effects on the economic development of high-income countries by causing health problems and reducing the quality of life, which in turn may deter investment and reduce productivity.