Use the Information Below to Answer the Following Questions

question 110

Multiple Choice

Use the information below to answer the following questions.
Fact 3.5.1
The market for coffee is initially in equilibrium.Pepsi is a substitute for coffee;cream is a complement of coffee.Consider the market for coffee.Assume that all ceteris paribus assumptions continue to hold except for the event listed.
-Refer to Fact 3.5.1.A technological improvement lowers the cost of producing coffee.At the same time,preferences for coffee decrease.The equilibrium quantity of coffee

• A)increases.
• B)decreases.
• C)remains the same.
• D)increases or decreases depending on whether the price of coffee falls or rises.
• E)increases,decreases,or remains the same depending on the relative shifts of the demand and supply curves.

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