Practise Midterm Questions

2. Suppose we are analyzing the market for Iced Americano, one of iced coffee varieties.

Graphically illustrate the impact each of the following would have on demand or supply. Also

show how equilibrium price and quantity have changed.

a. Winter starts and the weather turns sharply colder.

b. The price of Iced Latte, a substitute for Iced Americano, falls.

c. The price of coffee beans decreases.

d. The price of labor falls.

e. A better method of harvesting coffee beans is introduced.