What Would Happen to the Equilibrium Price and Quantity of Coffee

question 42

Multiple Choice

What would happen to the equilibrium price and quantity of coffee if the wages of coffee-bean pickers fell and the price of tea fell?

• A)Price would fall, and the effect on quantity would be ambiguous.
• B)Price would rise, and the effect on quantity would be ambiguous.
• C)Quantity would fall, and the effect on price would be ambiguous.
• D)Quantity would rise, and the effect on price would be ambiguous.

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Definitions:

Common Stock

A type of equity security that represents ownership in a corporation, granting holders voting rights and a share of the profits.

Earnings Per Share

A company's profit divided by the number of common shares outstanding, indicating the profitability on a per-share basis.

Stockholders' Equity

Represents the residual value of assets minus liabilities, indicating the ownership interest of shareholders in a company.

Earnings Per Share

A financial metric that calculates the portion of a company’s profit allocated to each outstanding share of common stock, indicating a company's profitability.