A positive supply shock refers to an unexpected event that increases the production capacity of suppliers and shifts the entire supply curve to the right. It results in a surplus of goods or services at the existing price level.
Related terms
Quantity Supplied: The quantity supplied is the specific amount of a good or service that producers are willing and able to sell at a given price level.
Supply Curve: The supply curve represents the relationship between the price of a good or service and the quantity that suppliers are willing to produce and sell.
Surplus: A surplus occurs when the quantity supplied exceeds the quantity demanded at a particular price level.