Crop failures generally produce ________ supply shocks in which the price level rises and then ________.
A)temporary,holds at its new higher level
B)temporary,returns to its previous level
C)permanent,holds at its new higher level
D)permanent,returns to its previous level

Question

Quizplus · Accepted Answer

Crop failures typically result in temporary supply shocks because the supply disruption is not permanent; crops can be replanted and grown again. After the initial shock and the resulting price increase, prices tend to return to their previous level once the supply issue is resolved and crop production returns to normal.

Crop Failures Generally Produce ________ Supply Shocks in Which the Price