If penalties are imposed only on buyers (but not on sellers) of marijuana, the equilibrium price of marijuana ________, and the equilibrium quantity of marijuana sold ________.
A) rise; increase
B) rise; decrease
C) fall; increase
D) fall; decrease

Question

Quizplus · Accepted Answer

When penalties are imposed on buyers, the demand for marijuana decreases, leading to a lower equilibrium price and a lower equilibrium quantity sold.

If Penalties Are Imposed Only on Buyers (But Not on Sellers)