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California is a major producer of grapes used in wine production. There is an unexpected wildfire in California that destroys some of the grapes. What happens in the market for wine?
a. Supply of wine increases. Price decreases and quantity increases.
b. Demand for wine increases. Price decreases and quantity increases.
c. Supply of wine decreases. Price increases and quantity decreases.
d. Demand and supply decrease. Price increases and quantity decreases.
e. Demand for wine decreases. Price increases and the effect on quantity is ambiguous.
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