Making drugs, such as cocaine, illegal results in a higher price than would be present if the drugs were legal. All else constant, the higher price results in drug users spending
A) more on drugs if the demand for drugs is inelastic.
B) more on drugs if the demand for drugs is elastic.
C) less on drugs if the demand for drugs is inelastic.
D) more on drugs if the demand for drugs is unitary elastic.

Question

Quizplus · Accepted Answer

If the demand for drugs is inelastic, then consumers are less sensitive to changes in price and will continue to purchase drugs despite the higher cost. As a result, they will spend more on drugs when the price is higher due to drug prohibition.

Making Drugs, Such as Cocaine, Illegal Results in a Higher