Studies Have Shown That Drinking One Glass of Red Wine

question 196

Multiple Choice

Studies have shown that drinking one glass of red wine per day may help prevent heart disease.Assume this is true,and a fungal disease destroys a large portion of the grape harvest of California vineyards.In the market for red wine,these two developments would

• A)increase demand and increase supply,resulting in an increase in the equilibrium quantity and a decrease in the equilibrium price of red wine.
• B)increase demand and decrease supply resulting in a decrease in both the equilibrium quantity and the equilibrium price of red wine.
• C)increase demand and decrease supply,resulting in an increase in the equilibrium price and an uncertain effect on the equilibrium quantity of red wine.
• D)increase demand and decrease supply,resulting in an increase in both the equilibrium price and the equilibrium quantity of red wine.

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Definitions:

Federal Expenditures

Spending by the federal government of a country, including costs for defense, welfare, infrastructure, and other public services.

Income Security

A social welfare concept ensuring individuals have a basic level of income to cover essential needs.

Social Security

A government program that provides financial assistance to individuals during retirement, disability, or upon the death of a spouse or parent.

Discretionary Spending

This refers to the portion of government spending that is decided through the annual appropriations process, covering non-essential services that do not include mandatory spending like Social Security and Medicare.