Last year, the equilibrium price for a cup of coffee was $5 and the equilibrium quantity sold was 800 cups. This year, the equilibrium price remained $5, however, the equilibrium quantity increased to 1,000 cups. Assume that tea is a substitute for coffee, coffee and sugar are complements, and that coffee beans are input into coffee production.

For each of the following, identify whether it could correctly explain the outcomes that we observed in the coffee market. Briefly explain your reasoning for each.

1. There was a decrease in the number of tea producers, and the supply of coffee beans increased.
2. A medical report highlighted the positive health impact of drinking coffee, and there was a decrease in the number of coffee producers.
3. There was an increase in the number of sugar producers, and the supply curve for coffee remained unchanged.