Suppose Canada steps up efforts to combat drug trafficking and, with the aid of the U.S. border patrol, intercepts a significant percentage of cocaine shipments. What will be the impact of this on the market for cocaine in Montréal?

Question

Quizplus · Accepted Answer

Intercepting a significant percentage of cocaine shipments will decrease the supply of cocaine in the Montréal market. Due to the scarcity of the commodity, the price of cocaine will increase. This is supported by the law of demand, which states that as the supply of a good decreases, ceteris paribus, there will be an increase in its price. Therefore, option B is the best choice.

Suppose Canada Steps Up Efforts to Combat Drug Trafficking And