Suppose that buying and selling a certain good is made illegal.In the market for this good,the demand curve shifts ________ and the supply curve shifts ________.

Question

Quizplus · Accepted Answer

When a good is made illegal, the demand for it decreases, causing the demand curve to shift leftward. At the same time, suppliers of the good may face legal penalties or fines, which increases the cost of producing the good and reduces the supply of it in the market, causing the supply curve to shift leftward as well. Therefore, both the demand and supply curves shift leftward.

Suppose That Buying and Selling a Certain Good Is Made