If Scientists Discover That Steamed Milk, Which Is Used to Make

question 118

Multiple Choice

If scientists discover that steamed milk, which is used to make lattés, prevents heart attacks, what would happen to the equilibrium price and quantity of lattés?

• A)Both the equilibrium price and quantity would increase.
• B)Both the equilibrium price and quantity would decrease.
• C)The equilibrium price would increase, and the equilibrium quantity would decrease.
• D)The equilibrium price would decrease, and the equilibrium quantity would increase.

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Definitions:

Process Innovation

The introduction of new or significantly improved production or delivery methods in business.

Exploratory

Pertaining to or involving investigation or examination with the purpose of discovering new information or relationships.

Product

An item or service created through a process and offered in the market to satisfy a need or want.

Product Innovation

The development of new or improved goods or services that are sold to meet customer needs.