Nobel prize-winning economist Gary Becker suggests that a tax could be set so that it raised drug seller costs without prohibition, and in turn would:
A) increase seller revenues.
B) decrease seller revenues.
C) increase government revenues.
D) decrease government revenues.

Question

Quizplus · Accepted Answer

If a tax is set to raise drug seller costs, it would increase the price of drugs for consumers, which could lead to decreased demand. This could result in decreased seller revenues, but the tax itself would generate revenue for the government. Therefore, the best choice is C - increase government revenues.

Nobel Prize-Winning Economist Gary Becker Suggests That a Tax Could