Use the figure below to answer the following questions.
Table 3.5.2
Demand and Supply Schedules for Cups of Coffee each day at CoolU

-Refer to Table 3.5.2.Professor Hyper publishes a new study,showing that coffee raises the test performance of students.Students double their demand for coffee and the quantity of coffee demanded at each price doubles.In addition,a premature frost destroys half the coffee trees and the supply of coffee is cut in half.The new equilibrium price is $________ and the new equilibrium quantity is ________ cups a day.
A)1.10;400
B)1.10;1,600
C)1.10;800
D)1.50;800
E)1.50;400.

Question

Use the figure below to answer the following questions.
Table 3.5.2
Demand and Supply Schedules for Cups of Coffee each day at CoolU
 
-Refer to Table 3.5.2.Professor Hyper publishes a new study,showing that coffee raises the test performance of students.Students double their demand for coffee and the quantity of coffee demanded at each price doubles.In addition,a premature frost destroys half the coffee trees and the supply of coffee is cut in half.The new equilibrium price is $________ and the new equilibrium quantity is ________ cups a day.
A)1.10;400 
B)1.10;1,600 
C)1.10;800 
D)1.50;800 
E)1.50;400.

Quizplus · Accepted Answer

Since demand doubles at every price, the new demand curve shifts to the right, as shown in the graph below. 
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However, the supply of coffee is cut in half, so the supply curve shifts to the left, as shown below. 
a1be425d_b0d6_b603_0c2e_063115d0c024_TB5272_20_TB5272_00_TB5272_00
The new equilibrium price is where the new demand and supply curves intersect, and the new equilibrium quantity is the quantity demanded and supplied at that price. As shown in the above graph, the new equilibrium price is $1.50, and the new equilibrium quantity is 800 cups a day. Therefore, the answer is D.

Use the Figure Below to Answer the Following Questions