Part (b) The US government becomes concerned about the increasing prevalence of drones. It considers introducing a license fee: Anyone buying a drone must acquire a license, which costs $25, and covers the lifetime of the drone. How do you predict that the license fee will affect the retail price of drones, and the number of drone purchases? Be quantitatively specific. (Assume that the penalties for owning a drone without a license are sufficiently severe that everyone who buys a drone buys a license.

Part (c) Briefly explain your quantitative prediction in part (b), in words, using economic concepts?