Suppose that the supply schedule of Indonesian Coffee beans

Suppose that the supply schedule of Indonesian Coffee beans is as follows: Price of Indonesian coffee beans (per pound) $4.00 $3.50 $3.00 $2.50 $2.00 Quantity of Indonesian coffee beans supplie (pounds) 6,000 5,000 4,000 3,000 2,000

Solution

The new price is obtained at intersection of (DI + C) and S curves.

Corresponding equilibrium price = $3.50