Question

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. The equilibrium price would decrease, and the equilibrium quantity would increase. b. The equilibrium price would increase, and the equilibrium quantity would decrease. c. Both the equilibrium price and quantity would increase. d. Both the equilibrium price and quantity would decrease.

Answer 1

The equilibrium price would increase, and the equilibrium quantity would decrease If the price and quantity of lattés is the cost of producing steamed milk, which is used to make lattés, rises.

Answer 2

b. The equilibrium price would increase, and the equilibrium quantity would decrease.

Step-by-step explanation:

As the cost of production rises, that also means that the equilibrium price should rise as well because the cost is one of the principal factors to take into account the pricing of products, now that the cost increased, the amount of lattes that need to be sold in order to find the equilibirum point is less, that means that the equilibriu quantity will decrease.