A Severe Freeze Has Once Again Damaged the Ontario Grape

question 94

Multiple Choice

A severe freeze has once again damaged the Ontario grape crop. What will the impact be on the market for wine?

• A) a leftward shift of the supply curve
• B) a leftward shift of the supply curve and a rightward shift of the demand curve, resulting in a higher equilibrium price
• C) a leftward shift of both the supply and demand curves
• D) a leftward shift of the demand curve, as consumers try to economize because of the shortage

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Definitions:

Qualitative Characteristic

A feature inherent in financial information that makes it useful to users, such as relevance or reliability.

Investment Analysis

The process of evaluating an investment for profitability and risk, thereby enabling the investor to make informed decisions.

Present Value Analysis

A method of valuing a future cash flow to determine its worth at the present time, taking into account the time value of money.

Capital Investment

Money expended by a business to purchase or improve tangible assets like land, factories, or machinery.