Suppose one county in Missouri decides it wants to reduce alcohol consumption, so the county passes a law that raises the price of a bottle of beer by $1. As a result, people drive to other counties to drink alcohol, which results in an increase in drunk driving. This illustrates the principle that people respond to incentives.

Question

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This scenario demonstrates the principle that people respond to incentives because the increase in the price of beer in one county incentivizes individuals to seek cheaper alternatives in neighboring counties, leading to unintended consequences such as an increase in drunk driving.

Suppose One County in Missouri Decides It Wants to Reduce