The Matcha Boom and Rising Tencha Prices

Answer the following questions to check your understanding of the story.

Why has the demand for matcha increased?

a) Tencha is produced on a slow-growing plant.

b) Social media has changed consumer preferences.

c) Matcha has become a substitute in production of other drinks.

d) The price of tencha leaves rose.

How does the increase in demand for matcha change the equilibrium price and quantity of tencha leaves today?

The equilibrium price of tencha leaves ___________ and the equilibrium quantity ___________.

a) rises; doesn’t change

b) doesn’t change; doesn’t change

c) doesn’t change; increases

d) rises; increases

If the demand for matcha remains at its current level, how will the equilibrium price and quantity of tencha leaves change over the next few years?

The equilibrium price will _________ and the equilibrium quantity will __________

a) fall; decrease

b) fall; increase

c) rise; decrease

d) rise; increase

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