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Some policy makers have claimed that the U.S. government should purchase illegal drugs, such as cocaine,...

Some policy makers have claimed that the U.S. government should purchase illegal drugs, such as
cocaine, to increase the price that drug users face and therefore reduce their consumption. Does this idea
have any merit? Illustrate this logic in a simple supply and demand framework. How does the elasticity of demand for illegal drugs relate to the efficacy of this policy? Are you more or less willing to favor this policy if you are told demand is inelastic?

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Ans :- Some policy makers have claimed that the U.S. government should purchase illegal drugs,such as cocaine, to increase the price that drug users face and therefore reduce their consumption.

Solu ion Sutplus be seen as havinq a This Consumption because Q*ice demand and Suppliec the paice dlooč. Hence, buying SutP1чт illegal dẽu This demand on ihe «lastrcily j demand n Consumption due to ptice tloot 15 tlativ<ly his policy. (ve would be Less oilln tduvor Jhis on Consumpon ls not muth. h.f

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