what can cause a demand shock 
demand shocks may be caused for one or more of several reasons an economic recession may lead to high unemployment where people are unable to spend as they had before natural or geopolitical disasters can also have a similar effect in the short run demand shocks can also occur if a technological advance makes a previous technology quickly obsolete did government stimulus checks create a demand shock in the wake of the covid 19 pandemic the u s government issued a series of stimulus checks to american households the goal was to help families cope with lockdowns business closures and other disruptions however these checks also may have been a positive demand shock boosting spending by too much as the economy recovered and leading to high inflation 4