Question

A black market is a market in which illegal sales take place between buyers and sellers....

A black market is a market in which illegal sales take place between buyers and sellers. How is price gouging different from black market transactions?

Please explain with examples if possible

Business   Economics   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

The black market is illegal in the market. Since it is against the law as in the black market, unreported transactions are carried out at inflated prices.

Price gouging occurs when a producer charges the inflated price of essential items through the time of crisis or when a shortage of essential items rises. The inflated price reduces the wastage of goods and needy people are able to purchase the essential items.

government might declare the practice of gouging the illegal. If the price gouging is declared illegal, there will be rise in the black market transactions as the demand is too high relative to the supply.

Thus, gouging could be legal or illegal but black market is illegal. The black market is result of price gouging being declared illegal by the government.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
1) Economists have traditionally assumed that consumers are rational: they use their incomes and time to...
1) Economists have traditionally assumed that consumers are rational: they use their incomes and time to make themselves as well off as they can. But recent research shows that consumers also want to be treated fairly. Surveys have found that many consumers believe it is unfair for firms to raise the prices of some goods after a sharp increase in demand (for example, following a tropical storm) while the same increase in price following a decrease in supply is deemed...
Consider a market where potential sellers have an informational advantage over buyers. In this market potential...
Consider a market where potential sellers have an informational advantage over buyers. In this market potential sellers may possess either a high-quality or a low-quality good. Assume that each potential seller has one good that she may either sell or retain. If the seller has a low-quality good, it is worth $15 to her, while high-quality goods are worth $45. One half of the potential sellers possess high-quality goods, while the other half possesses low-quality goods. Buyers are at an...
1. The sale of illegal drugs has consequences for both sellers and buyers. However, legal penalties...
1. The sale of illegal drugs has consequences for both sellers and buyers. However, legal penalties are generally imposed aggressively on the suppliers of drugs rather than on the demanders. Think about the impact these penalties likely have on supply and demand. How might the effects of prohibiting drugs have been different had legal penalties been imposed more aggressively on demanders rather than on suppliers? 2. You learned about government-imposed price controls and the theory behind them. These price controls...
21. A competitive market has all of the following characteristics except a. The buyers and sellers...
21. A competitive market has all of the following characteristics except a. The buyers and sellers are price makers b. Firms can freely enter and exit the market c. There are many buyers and sellers in the market d. Goods offered by the sellers are very similar 23. The firm shuts down if the revenue it would earn from producing is less than its variable costs of production a. true b. false 26. In the long run, the competitive firm...
Explain how, when buyers and sellers are rent-seeking competitors, they will ensure that the economic rents...
Explain how, when buyers and sellers are rent-seeking competitors, they will ensure that the economic rents from prices that are too high or too low are competed away to ensure a market-clearing price- quantity equilibrium. Be sure to explain why behaving as a price-taker is therefore a firm’s best response in equilibrium.
The market for DVDs has supply and demand curves given by Ps = 2Qs and Pd...
The market for DVDs has supply and demand curves given by Ps = 2Qs and Pd = 42 - Qd, respectively. a) How many units will be traded at a price of $35.00? b) Which participants will be dissatisfied at a $35 price (sellers or buyers)? (Click to select)SellersBuyers c) How many units will traded at a price of $14? d) Which participants will be dissatisfied at a $14 price (sellers or buyers)? (Click to select)SellersBuyers e) What quantity of...
1) Which one of the following best describes a broker? intermediary who arranges trades between buyers...
1) Which one of the following best describes a broker? intermediary who arranges trades between buyers and sellers trader who buys and sells from their own inventory person who buys securities for his or her own account on an exchange floor trader who transacts business on behalf of a securities issuer 2) Over-the-counter market activity is reflected in the Nasdaq index. True False 3) Marcus just placed a stop limit order to buy 100 shares at $20 stop, $25 limit....
[5] One reason buyers demand less of a product as its price increases is: A) substitute...
[5] One reason buyers demand less of a product as its price increases is: A) substitute goods are usually available. B) high-priced goods place buyers in higher tax brackets. C) buyers must save more of their incomes as prices increase. D) sellers offer less of the product for sale as its price increases. [6] Which of the following explains why consumers purchase less of a good or service when its price increases? A) A limited income from which purchases can...
(10 marks) The market for digital video discs (DVDs) has supply and demand curves given by...
The market for digital video discs (DVDs) has supply and demand curves given by P = 2Qs and P = 42 - Qd, respectively, where P is in $/DVD and Qs and Qd are in DVDs. Construct and label a diagram (instead of drawing the actual graph, briefly explain the graph instead. Explain all the curves, shifts, points and axis, etc). How many units will be traded at a price of $35? At a price of $14? Which participants in...
1- If the following processes take place at constant pressure, which will be exothermic and which...
1- If the following processes take place at constant pressure, which will be exothermic and which will be endothermic? I. Gasoline burns. II. Two solids at room temperature are mixed and the temperature of the mixture decreases to 15 °C    ( please expline why did you choose your anwser) 2-What is the correct ranking of the electrostatic potential energy of the following systems, starting with the one with the lowest energy? I an electron that is 2.8 nm from...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT