1.

In this case, we can use a framework of price ceiling to explain the market effect of too low a price

(essentially $0) for keys. Currently, there is a long waiting list for kidney transplants while the

number of organ donors is limited. It means the demand curve in this situation is higher than the

supply curve and leads to a new higher price equilibrium. With the price of kidneys setting at a price

ceiling is $0, it will create a shortage because the quantity demanded exceeds the quantity supplied. 

2. If the price of kidneys is $0, the supply of kidneys definitely comes from voluntary donors in the

opt-in system or others in the opt-out system who are above 18 years old and signed automatically

in the donor system. There is any quantity supplied as opposed to zero because the quantity

supplied is lower than the quantity demanded. 

3. If paying for organs is allowed under the law, it could increase the number of organ donors and

encourage people to donor voluntarily than before; however, there is exploitation because of health

conditions, fair price reasons, or legal issues. 

4. Based on the following reading from the World Journal of Transplantation, “Key Issues in

Transplant Tourism,” organ donors are individuals who travel across borders to donate or stay in the

host country to wait for the traveling of receivers. Also, they have financial issues and need money

to take care of their life and family, so they have to sell an organ even knowing a worse consequence

for their health after that. Whereas organ recipients agree to overseas travel for transplants. The

service can be processed between insurance companies in the US and foreign care clients. These

patients do not want to stand in a long waiting line for scaring of dying before getting a transplant or

have found a matching organ and are ready for a transplant.