WHAT IS ABNORMAL SUPPLY AND ABNORMAL DEMAND
https://www.google.com/search?source=hp&ei=wVb8W82jIJC6ggf9o5nACw&q=+ABNORMAL+SUPPLY+AND+ABNORMAL+DEMAND&btnK=Google+Search&oq=+ABNORMAL+SUPPLY+AND+ABNORMAL+DEMAND&gs_l=psy-ab.3..33i22i29i30.4559.4559..5285...2.0..0.134.242.0j2......0....1j2..gws-wiz.....6..35i39.zonKnx0MxNY
Abnormal supply and abnormal demand refer to situations in economics where the supply or demand of a particular good or service deviates significantly from what is considered normal or expected.
Abnormal supply occurs when the quantity of a product or service available in the market is unusually high or low. This can be caused by various factors such as unexpected changes in production capacity, disruptions in the supply chain, or natural disasters that affect the availability of inputs. Abnormal supply can lead to imbalances in the market, potentially resulting in price fluctuations and scarcity or surplus of the product.
Abnormal demand, on the other hand, occurs when the quantity of a product or service demanded by consumers is significantly higher or lower than what is typically expected. This can be due to factors like changes in consumer preferences, marketing campaigns, or sudden shifts in economic conditions. Abnormal demand can influence prices, create shortages or excess inventory, and impact the profitability of businesses.
To identify abnormal supply or demand, economists and market analysts typically use various indicators and tools such as:
1. Historical data: Comparing current supply or demand levels to past trends can help identify any significant deviations from the norm.
2. Market research: Collecting data through surveys or interviews with consumers, suppliers, or industry experts can provide insights into shifts in supply or demand patterns.
3. Statistical analysis: Techniques such as regression analysis and time series forecasting can be used to analyze historical data and detect abnormalities.
4. Economic indicators: Consideration of macroeconomic factors like GDP, inflation, and employment rates can help gauge the overall state of the economy and identify potential abnormal supply or demand.
By monitoring these indicators and analyzing relevant data, economists and businesses can better understand abnormal supply and demand situations, anticipate market dynamics, and make informed decisions to address the imbalances.
Abnormal demand --
Everyone in the city of Austin, TX, was put on a boil-water notice a few weeks ago because their city water plant was overwhelmed by floodwaters coming from the north. Suddenly, the stores ran out of bottles and cases of drinking water! That's an abnormal demand.
Abnormal supply --
After the boil-water notice was cleared, suddenly many stores had a vast surplus of cases of drinking water in storage.