In the context of consumer surplus and willingness to pay, who creates the demand for coffee shops, and who creates the demand for coffee shop employees?

• A. Consumers create the demand for coffee shops, while coffee shop owners create the demand for coffee shop employees.
• B. Government creates the demand for both coffee shops and coffee shop employees.
• C. Coffee shop employees create the demand for coffee shops, while consumers create the demand for coffee shop employees.
• D. Coffee shop owners create the demand for coffee shops, while consumers create the demand for coffee shop employees.

Answer: (A)

Verified step by step guidance

1. Understand the concept of demand in microeconomics: Demand for a good or service is created by the buyers or consumers who are willing and able to purchase it at various prices.
2. Identify who demands coffee shops: Consumers create the demand for coffee shops because they want to buy coffee and other products or services offered by these shops.
3. Identify who demands coffee shop employees: Coffee shop owners create the demand for employees because they need workers to operate their business and provide services to consumers.
4. Recognize the difference between consumer demand and derived demand: The demand for employees is a derived demand, meaning it depends on the demand for the final product (coffee and services) that consumers want.
5. Conclude that consumers create the demand for coffee shops, while coffee shop owners create the demand for coffee shop employees, as the employees are hired to meet consumer demand.