Question

decision point: a new coffee brewer
you receive an email message from a sales rep.
from: coffee machinex sales dept.
subject:new product
hello, im your sales rep for coffee machinex products. we have a new commercial brewer that uses far less energy than conventional machines and -- best of all -- uses only half the amount of coffee beans to get the same rich coffee flavor. think what this will do for your bottom line! please contact me to hear more about it.
what is the impact on moondogs supply if you purchase this new commercial brewer?
select an option from the choices below and click submit.
the new brewing machine would allow moondogs to make coffee more quickly, which would affect demand, not supply.
the new brewing machine will negatively impact supply because it increases the price of inputs.
the new brewing machine will positively impact supply because it will enable moondogs to produce its coffee more efficiently and with less cost in terms of energy and coffee beans.

Explanation:

To determine the impact on supply, we analyze each option:

1. The first option claims the machine affects demand, but the machine's efficiency (less energy, fewer beans) relates to production costs, impacting supply, not just demand speed. So this is incorrect.
2. The second option says the machine negatively impacts supply by increasing input prices, but the machine uses less energy and beans, reducing input costs, not increasing. So this is incorrect.
3. The third option states the machine positively impacts supply as it enables more efficient production with lower costs (less energy, half the coffee beans). This aligns with supply - side factors (cost of production, efficiency) affecting supply.

Answer:

The new brewing machine will positively impact supply because it will enable Moondogs to produce its coffee more efficiently and with less cost in terms of energy and coffee beans.