Use the Information Below to Answer the Following Questions

question 188

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 new study comes out, revealing that drinking Pepsi increases your ability to study. The equilibrium quantity of coffee

• A)increases.
• B)decreases.
• C)remains the same.
• D)increases or decreases depending on the slope of the supply and demand curves.
• E)increases or decreases depending on the relative shifts of the supply and demand curves.

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Definitions:

Double Taxation

A taxation principle referring to income taxes paid twice on the same source of earned income; it can occur when income is taxed at both the corporate level and personal level.

Unlimited Liability

A legal status where the business owner's personal assets can be used to satisfy the debts and liabilities of the business.