Which Following Change in the Coffee Market Would Shift the Supply

question 57

Multiple Choice

Which following change in the coffee market would shift the supply curve to the right?

• A) A study finds that drinking coffee leads to higher grades.
• B) The wage for employees in the coffee business decreases.
• C) The income in the economy increases.
• D) Firms expect the price of coffee to increase in the future.
• E) Fifty Starbucks coffee shops close down.

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Definitions:

Risk Premium

The return in excess of the risk-free rate of return that an investment is expected to yield.

Risky Asset

An investment that carries a significant possibility of losing some or all of its value.

Risk-Free Investment

An investment that is considered to be free of credit risk, with the most common examples being government-issued securities.

Capital Gains Return

The profit achieved from the sale of a security or investment which has increased in value over the holding period.