Currently, it is illegal to import prescription drugs into the United States despite the fact that U.S. consumers could buy drugs from Canada at lower prices than those available in the United States. What set of cost curves is most consistent with the price difference between the United States and Canada?

Question

Quizplus · Accepted Answer

Producing a drug typically involves high fixed costs due to research and development, but once developed, the marginal cost of producing additional units is relatively low. This cost structure can lead to price differences between markets like the U.S. and Canada.

Currently, It Is Illegal to Import Prescription Drugs into the United