• Is demand for illegal drugs elastic, inelastic, highly elastic, highly inelastic,perfectly elastic, or perfectly inelastic?...

• Is demand for illegal drugs elastic, inelastic, highly elastic, highly inelastic,perfectly elastic, or perfectly inelastic?

• What would the shape of that demand curve be (flatter or steeper)?

• Prior to completing the Written assignment, you probably have ideas about how we can reduce illegal drug usage. Should we work more on reducing supply or reducing demand?

• Why do you think that strategy (supply-side or demand-side) is best?

Solutions

Expert Solution

Demand for illegal drugs is assumed to be Highly Inelastic since the consumption is not deterred with higher prices instead the spending is increased and since the demand is inelastic then the demand curve will be Steeper as the demand will not change much with prices

Although generally both policies works in tandem but economists argue that since demand is inelastic and as such supplier will become available because of demand and the supernormal profits hence the strategy should be more focussed around reducing demand by educating yourths and possible consumers,highlighting negatives, campaign etc Hence, demand side strategy is better

Rahul Sunny answered 1 year ago

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