Consider the ivory market once more. Starting from an equilibrium at point A in Figure 11.2, suppose that a partial lifting of the ivory ban lowers the marginal cost of selling on the black-market, but ivory demand is unchanged. Draw a graph that shows both an increase in black-market ivory resulting from lower costs and an influx of legal ivory such that at the new equilibrium, the quantity of black-market sales remains at QA.

Consider the ivory market once more. Starting from an equilibrium at point A in Figure 11.2, suppose that a partial lifting of the ivory ban lowers the marginal cost of selling on the black-market, but ivory demand is unchanged. Draw a graph that shows both an increase in black-market ivory resulting from lower costs and an influx of legal ivory such that at the new equilibrium, the quantity of black-market sales remains at QA.

Micro Economics For Today

10th Edition

ISBN:9781337613064

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter4: Markets In Action

Section: Chapter Questions

Problem 3SQ

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