What are the effects of rationing and hoarding in economics.

All QuestionsCategory: Secondary SchoolWhat are the effects of rationing and hoarding in economics.
Owoeye olusayo asked 2 years ago

Before using this website, you must read our disclaimer here.

What are the effects of rationing and hoarding in economics.

2 Answers
StopLearn Team Staff answered 2 years ago

Before using this website, you must read our disclaimer here.

Rationing distorts consumer behavior since consumers cannot purchase their desired quantities at government controlled prices. Since consumers incur smaller than desired expenditures for rationed goods and services, rationing may lead to increased demand for other commodities that can be purchased freely.
Secondary economic effects result from hoarding. Hoarding is an increase in demand. In the short-run with supply fixed, the price of the hoarded good would increase. With every increase-in demand, the price of the hoarded good would continue rising producing inflation.
Source: https://brainly.in/question/13599510

Your Answer

16 + 3 =