Figure 3-7
-Refer to Figure 3-7.Assume that the graphs in this figure represent the demand and supply curves for coffee.What happens in this market if buyers expect the price of coffee to rise?
A)Panel (a)
B)Panel (b)
C)Panel (c)
D)Panel (d)

Question

Figure 3-7 
-Refer to Figure 3-7.Assume that the graphs in this figure represent the demand and supply curves for coffee.What happens in this market if buyers expect the price of coffee to rise?
A)Panel (a) 
B)Panel (b) 
C)Panel (c) 
D)Panel (d)

Quizplus · Accepted Answer

In anticipation of a price increase, buyers are likely to purchase more coffee now to avoid higher prices later, shifting the demand curve to the right, as depicted in Panel (c). This shift represents an increase in demand due to the expectation of future price increases.

Figure 3-7 -Refer to Figure 3-7.Assume That the Graphs in This Figure