A black market can occur when

Assessment: JAMB UTME - Economics - 2004 Subject: Economics

Question 1 Report

A black market can occur when
Answer Details
A black market can occur when the consumption of a commodity is restricted or when the government sets prices either above or below the equilibrium. In these situations, there is a mismatch between the legal market price and the price that consumers are willing to pay, which creates an opportunity for a black market to emerge. In a black market, goods or services are bought and sold outside of the legal channels, often at higher prices due to the scarcity or illegality of the commodity.
Read lesson note on The Theory Of Supply (JAMB)
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