Question

What would happen to the equilibrium price and quantity of lattés if coffee shops began using a machine that reduced the amount of labor necessary to produce steamed milk, which is used to make lattés, and scientists discovered that coffee prevents heart attacks? (Show Your Work)

Answer 1

A machine that reduces the amount of labor use in the market will shift the supply curve to the right, the new price will be lower and the new quantity will be higher,

A scientist report that the coffee reduce the heart attack chances will increase the demand for coffee and that will shift the demand curve to the right, the new equilibrium will be at a higher price and higher quantity.

Here, both the events are increasing the quantity but one is decreasing the price and other is increasing the price. It will make the price indeterminate and the quantity will increase.