What would happen to the equilibrium price and quantity of lattés if the cost to produce steamed milk, which is used to make lattés, increased, and scientists discovered that lattés cause heart attacks?
a. Both the equilibrium price and quantity would increase.
b. Both the equilibrium price and quantity would decrease.
c. The equilibrium price would decrease, and the effect on equilibrium quantity would be ambiguous.
d. The equilibrium quantity would decrease, and the effect on equilibrium price would be ambiguous.
d
You might also like to view...
An amusement tax of $1 on every ticket sold to a concert is an example of a(n)
a. poll tax b. progressive tax c. unit tax d. income tax e. property tax
The distribution of wealth is more unequal than the distribution of income because wealth reflects
a. persistent wage differentials between people of different abilities b. physical assets as opposed to financial assets c. unequal distribution of talents in the population d. unequal access to education e. the distribution of lifetime accumulated assets