What Would Happen to the Equilibrium Price and Quantity of Lattés

question 7

Multiple Choice

What would happen to the equilibrium price and quantity of lattés if the cost of producing steamed milk, which is used to make lattés, rises?

• 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:

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