Question

A television station reports that the price of coffee has increased but the quantity traded in the market has decreased. This situation would be caused by a(n):

A. Increase in demand
B. Increase in supply
C. Decrease in demand
D. Decrease in supply

Answer 1

The situation described, where the price of coffee has increased but the quantity traded in the market has decreased, would be caused by a decrease in demand. Therefore, the correct answer is C. Decrease in demand.

Step-by-step explanation:

The situation described, where the price of coffee has increased but the quantity traded in the market has decreased, would be caused by a decrease in demand. According to the law of demand, when the price of a good increases, the quantity demanded decreases. Additionally, the decrease in quantity traded indicates a decrease in supply. Therefore, the correct answer is C. Decrease in demand.