What is a sudden shortage of goods called?

Economics Dec 17, 2020

Expert Solution

A sudden shortage of goods is called a supply shock and results in a change of price. Supply shocks can be positive and negative, but they are usually negative (i.e. shortages). Negative supply shocks or sudden shortages result in a decrease of production and, therefore, an increase of prices. Supply shocks occur because of events that happen suddenly, such as war or natural disasters.

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