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The Matcha Boom and Rising Tencha Prices

EconEye Admin

Influencers on social media have increased demand for many foods and drinks, including matcha. Tencha leaves, which are used to make matcha, nearly tripled in price between 2024 and 2025. The bushes that produce tencha leaves take years to grow.—economist.com

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

Why has the demand for matcha increased?

Wrong! - Under what circumstances does the demand for matcha change and when does the supply of matcha change?

You're Right! - Social media has influenced consumer preferences, increasing their demand for matcha.

 

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 ___________.

Wrong! - The demand for tencha leaves increases. How does the elasticity of supply of tencha leaves influence the equilibrium price and the equilibrium quantity today?

Well Done! - The demand for tencha leaves increases. With perfectly inelastic supply, the equilibrium price rises and the equilibrium quantity doesn’t change.

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 __________

Wrong! - Producers of tencha leaves will plant more bushes, and the supply of leaves will increase. How will the equilibrium price and quantity change?

Good Job! - Producers of tencha leaves will plant more bushes, and the supply of leaves will increase. The equilibrium price will fall, and the equilibrium quantity will increase.

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