Question: The table gives the demand and supply schedules for an illegal drug.
Price Quantity demanded Quantity supplied
(dollars per unit) (units per day)
50 500 300
60 400 400
70 300 500
80 200 600
90 100 700
a. What is the price and how many units are bought if there is no penalty on drugs?
b. If the penalty on sellers is $20 a unit, what are the price and quantity consumed?
c. If the penalty on buyers is $20 a unit, what are the price and quantity consumed?