What is the likely effect on the market for wine of a simultaneous increase in both consumer incomes and producer taxes on wine?

Question

Quizplus · Accepted Answer

The increase in consumer incomes will lead to a higher demand for wine, resulting in an increase in both price and quantity. However, the increase in producer taxes will raise costs for wine producers, potentially reducing supply and output. The combined effect on quantity cannot be determined with certainty, but there is likely to be an increase in price.

What Is the Likely Effect on the Market for Wine