To conduct a partial equilibrium analysis of a change in consumer preferences toward coffee and away from tea, you must consider
A) changes in the equilibrium price and quantity of coffee.
B) changes in the amount of resources allocated to the production of coffee.
C) changes in the price of resources allocated to the production of coffee.
D) all of the above

Question

Quizplus · Accepted Answer

Partial equilibrium analysis involves examining the equilibrium of a single market in isolation, considering changes in price, quantity, and resource allocation within that market. Thus, when analyzing a shift in consumer preferences toward coffee, it's important to consider all aspects mentioned: the equilibrium price and quantity of coffee, the resources allocated to its production, and the price of those resources.

To Conduct a Partial Equilibrium Analysis of a Change in Consumer