question archive The price of coffee rose sharply last month, while the quantity sold remained the same
The price of coffee rose sharply last month, while the quantity sold remained the same
Subject:EconomicsPrice:2.88 Bought3
The price of coffee rose sharply last month, while the quantity sold remained the same. Five of the Big Bang Theory friends suggested various explanations. Use the following table to identify who of the friends correctly explained the changes in the price and quantity of coffee.
| Explanation | Correct | Incorrect |
| Howard: Supply decreased, but demand was unit elastic. | ||
| Raj: Supply decreased, but demand was perfectly inelastic. | ||
| Leonard: Demand increased, but supply was perfectly inelastic. | ||
| Penny: Demand increased, but supply decreased at the same time. | ||
| Sheldon: Demand increased, but it was perfectly inelastic. |
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| Explanation | Correct | Incorrect |
| Howard: Supply decreased, but demand was unit elastic. | Uncertain - we would have to know what the revenue was to know for sure. | |
| Raj: Supply decreased, but demand was perfectly inelastic. | Yes, this is the best answer. If people bought just as much regardless of price, the demand was perfectly inelastic. | |
| Leonard: Demand increased, but supply was perfectly inelastic. | No, demand stayed the same. | |
| Penny: Demand increased, but supply decreased at the same time. | No, demand stayed the same. | |
| Sheldon: Demand increased, but it was perfectly inelastic. | No, demand stayed the same. |
