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Black market can be denoted as a marketplace where a variety of expensive products and services are sold illegally. It is also known as the shadow economy or underground economy. The people involved in activities related to the black markets are mostly non-compliant to the laws related to the production and distribution of certain goods or services.

Black markets can be extremely damaging to the economy. Primarily because these are operated covertly, economic activities are not recorded, and tax codes are not followed. In the economic context, the most prominent black market exists in nations that have implemented strict currency controls. 

Deeper insights into the existence of the black market:

Black markets become active when people want to obtain products or services that are prohibited by law. Since most transactions are unrecorded in this area, the black market often skews the economic data. Black markets mostly appear when people want to evade taxes on the transaction for availing legal or illegal services.

Sometimes, black markets exist simply because people fail to understand there are laws they aren't following. For example, bartering and not providing information about the taxable value of the transaction, or appointing a housekeeper or babysitter but failing to pay the employment taxes.

Other times, the individuals participating in these activities don't want to act illegally. However, since they lack the ability to work legally and need to make money, they refrain from reporting their jobs or income to the government. Such situations crop up when illegal immigrants look for employment, when students travelling abroad get employment opportunity without procuring a work visa or when children work in violation of the minimum age limit.

Black markets can also gain prominence when government-administered price brackets prompt shortages of goods. For instance, if the government slashes the price at which a grocery store may sell packaged drinking water after a natural disaster, the store will swiftly run out of water. Under such circumstances, vendors will begin selling water at higher prices which people are actually willing to pay.

Different divisions of black market:

Black markets are operated in different regions across the world. These economies are omnipresent, mostly present in centrally planned nations including both developed or developing countries. Different types of underground activities are identified based on the particular institutional rules that they transgress. Here are the four major divisions.

• The illegal economy
• The unreported economy
• The unrecorded economy
• The informal economy

Moreover, different services obtained in an illegal may come above or below the price of legal market transactions.

These are some of the integral aspects of the black market. In case of any confusion, students can choose the next best alternative, i.e. hiring assignment help services of MyAssignmenthelp.com.

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