What will an individual do differently as a seller in the black market in the long run?
A) He or she will substitute away from producing the product.
B) He or she will substitute toward producing the product.
C) When there exists a binding price floor,he or she will be able to sell the good at a higher price.
D) When there exists a binding price ceiling,he or she will be able to sell the good at a lower price.
E) What he or she does as a seller in the long run will be no different from what he or she does in the short run.

Question

Quizplus · Accepted Answer

Engaging in black market activity entails additional risks and costs that legitimate markets do not have. Thus, sellers in the black market will have incentives to shift their production to other, less risky or illegal goods or services over time as costs and risks increase.

What Will an Individual Do Differently as a Seller in the Black