Final answer:
A drought reduces cocoa supply, shifting the supply curve left, and a study showing health benefits increases demand, shifting the demand curve right, generally leading to higher cocoa prices and a variable effect on the quantity traded depending on the relative shifts.
Step-by-step explanation:
The question pertains to the effect of external factors on the cocoa market, specifically the impact of a drought on the production side and the effect of a new study into cocoa's health benefits on the demand side. When cocoa-producing countries experience a drought, the supply of cocoa is likely to decrease. This can be represented by a leftward shift of the supply curve on a demand and supply graph. Conversely, if a new study reveals significant health benefits of cocoa, this information can stimulate demand, shifting the demand curve to the right.
The combined effect of these two changes would generally lead to a higher price for cocoa, as the reduced supply and increased demand both put upward pressure on prices. As for the quantity bought and sold, the net effect can vary. If the increase in demand is more significant than the decrease in supply, the quantity traded might increase despite higher prices.
If the decrease in supply is greater, the quantity traded might decrease. To illustrate this scenario, one would draw a standard demand and supply graph, mark the original equilibrium, and then demonstrate the shift of both curves accordingly.