A survey shows an increase in drug use by young people. In the ensuing debate, two hypotheses are proposed: Reduced police efforts have increased the availability of drugs on the street.Cutbacks in education efforts have decreased awareness of the dangers of drug addiction.  . Use supply-and-demand to show how each of these hypotheses could lead to an increase in quantity of drugs consumed. b How could information on what has happened to the price of drugs help us to distinguish between these explanations?

MACROECONOMICS
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ISBN:9781337794985
Author:Baumol
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Chapter4: Supply And Demand: An Initial Look
Section: Chapter Questions
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A survey shows an increase in drug use by young people. In the ensuing debate, two hypotheses are proposed:

Reduced police efforts have increased the availability of drugs on the street.Cutbacks in education efforts have decreased awareness of the dangers of drug addiction. 

. Use supply-and-demand to show how each of these hypotheses could lead to an increase in quantity of drugs consumed.

b How could information on what has happened to the price of drugs help us to distinguish between these explanations?

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