intermediate micro

intermediate micro - Sex, Booze, and Drugs Government's...

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Sex, Booze, and Drugs  Government’s attempts to prevent mutual beneficial exchange are unlikely to meet with spectacular success. Enforcements are often made on supplier side to induce a higher operation cost. 1. When activity is made illegal, people who are good at crime will be attracted to that activity, which results more violence. 2. To avoid detection and prosecution, suppliers have incentive to deal in more valuable version of their product and encouraging users to use more potent version. 3. When a product becomes illegal, there are few ways to obtain information about the quality, consumers frequently do not know what they are getting; the result is often unpleasant and deadly. Flying the Friendly Skies  Safety benefits, but achieving safety entails cost. The marginal benefits decline as the rate of safety increases. The marginal cost of safety increases as the rate of safety increases. So the efficiency occurs when the marginal cost of safety equals the marginal benefit of safety. It means that it is efficient for there to be some risk associated with air travel. The problem is that is also very expensive for individuals to obtain info about the actual
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intermediate micro - Sex, Booze, and Drugs Government's...

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