Question

Robert needs his daily fix of coffee in the mid-afternoon and visits different coffee shops that will give him as much utility as possible, given his $20/month food budget. On Monday, the Blue Coffee Shop was selling espresso shots for $3 each and Robert added 3 shots to his cappuccino. By Friday, the Purple Coffee Shop offered espresso shots for $2 each, while all other prices remained the same, so Robert was bold and added 4 espresso shots to his hot beverage. Given this information, plot Robert's demand curve for espresso shots. Provide your answer below: Price of Espresso Shots Friday (2,$3) Monday (3,$1) Quantity of Espresso Shots

Answer 1

The demand curve shows the negative relationship between the price and the quantity demanded , when the price decerased from $3 to $2 the consumer has increased the consumption from 3 to expresso shots to 4. As the price decreases the purchasing power of the consumer would increases so they would increase their consumption.

Price (3,3) 3 (2,4) N Quantity