supply shock
definition: A sudden shortage of a good
- Ex. gas, wheat
- Can’t produce quickly enough, so how do we deal with instant shortage?
- Increase prices, but that could lead to high inflation
- Sometimes the government has to step-in
- This is where we can see rationing


everyday examples
▪ food rations during WW2
▪ stores not allowing more than 1 item per family during COVID

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