Which of the following is NOT a beneficial supply shock?
A) an abundant harvest that increases food supplies
B) discoveries of natural resources
C) technological advances
D) an embargo on trade in oil

Question

Which of the following is NOT a beneficial supply shock?  
A) an abundant harvest that increases food supplies 
B) discoveries of natural resources 
C) technological advances 
D) an embargo on trade in oil

Quizplus · Accepted Answer

An embargo on trade in oil would decrease the supply of oil, which would cause prices to increase, having a negative impact on the economy. A, B, and C are all examples of beneficial supply shocks that would increase supply and have a positive impact on the economy.

Which of the Following Is NOT a Beneficial Supply Shock