Given the market for illegal drugs,when the government is successful in reducing the flow of drugs into the United States,
A)supply decreases,demand is unaffected,and price increases.
B)demand decreases,supply is unaffected,and price decreases.
C)demand and supply both decrease,leaving price essentially unchanged.
D)supply decreases,demand increases,and price increases substantially.

Question

Quizplus · Accepted Answer

When the government is successful in reducing the flow of drugs into the United States, the supply of drugs decreases. However, the demand for illegal drugs is usually inelastic, meaning that it is unaffected by changes in price or supply. Therefore, since demand remains constant, but the supply decreases, the price of drugs will increase.

Given the Market for Illegal Drugs,when the Government Is Successful