Economists use the term Black Markets for situations where ?
Correct answer: A. goods are sold at prices above legal or official price.
- A. goods are sold at prices above legal or official price.
- B. buyers and/or sellers are not paying taxes as they should
- C. illegal substances are sold
- D. transactions are not recorded in the GDP figures.
Explanation
A black market operates outside official price and legal controls, commonly selling goods above the legally permitted price. Tax evasion and illegal substances may occur in black markets but do not define the term by themselves.
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Individual consumers, firms and markets are examined through demand and supply, elasticity, consumer choice, production, costs, revenue and the determination of prices and output. The topic also covers market structures such as perfect competition, monopoly and oligopoly, plus market failure, externalities and the distinction between microeconomic decisions and economy-wide outcomes.
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