Question: Suppose the demand for fentanyl is completely east and fentanyl users earn money to steal from others and get money. To crack downloads regarding the use of fentanyl, the government has imposed stricter penalties on fentanyl suppliers and reduced its supply. How does this P do to the amount of stealing by fentanyl users?
Solution: Studonts subis resists the idea that the law of demand applies to addictive drugs. I understand why: if there is sub-control, it’s SEM that consumes it regardless of the price, so people consume it. While that is not strictly true, let’s follow the assumption of the question that the demand for fentanyl is completely resilient.
What does that mean? Completely inelastic demand means that the amount consumed remains the same when prices change. In graphical, the demand curve is a vertical line. Users spend the same amount.
Think about what will happen when the government cracks down on its suppliers. A decline in supply does not change the amount of balance consumed, as the demand for sin is completely resilient. Inserted, it raises the market price of fentanyl.
The key steps are: This is because users continue to buy the same quantity, but the higher prices lead to an increase in total spending on fentanyl. This means an increase in the amount of stolen, as finance is purchasing for purchase through theft.
This becomes clear to simple examples of numbers. Suppose a user buys one unit of fentanyl each week for $100 and steals $100 to do that. If the supply limit raises the price to $150, users will still consume one unit a week, but they will now have to steal $150.
Therefore, if demand is completely inelastic, a reduction in supply will not reduce consumption. Inserted, it raises the pries – and in this case leads to more stealing. If the assumption of inelastic demand is true, target reduced demand rather than supply for a more effective pole.
