Answer to Question #298540 in Microeconomics for garg

Question #298540

How does increase in the price of sugar affect the equilibrium quantity and price of coffee?


Illustrate using a graph

1
Expert's answer
2022-02-24T11:50:24-0500

Sugar is an essential input in coffee making process, so increase in sugar prices decreases the demand for coffee hence the demand curve for coffee shifts leftwards.








The graph above shows that demand of coffee decreases from Q to Q1.


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