Relative to the prices that would be observed in an uncontrolled market, prices charged in a black market are generally
A)lower, since sellers have trouble locating buyers.
B)lower, since buyers have trouble locating sellers.
C)higher, since black market sellers compensate for the risk of being caught.
D)higher, since most buyers enjoy goods more if they are illegal.

Question

Quizplus · Accepted Answer

Black market sellers take on additional risks by selling illegal products, so they compensate for that risk by charging higher prices. Additionally, there is often a limited supply of the illegal product in a black market, which can drive up prices further.

Relative to the Prices That Would Be Observed in an Uncontrolled