In reality, all the prices in the economy are inflexible and are not able to change rapidly when demand changes unexpectedly.
Subtopic: Demand shocks and inflexible prices

Question

Quizplus · Accepted Answer

In reality, prices are not always inflexible and can adjust based on changes in supply and demand. However, there are certain markets, such as labor markets or long-term contracts, where prices may be sticky and take longer to adjust to changes in demand. So while inflexible prices can be a factor in demand shocks, it is not always the case.

In Reality, All the Prices in the Economy Are Inflexible