Question

Identify the economic as well as social affects of hoarding.

• A. Creation of panic in the minds of the people.
• B. Exploitation of consumers.
• C. Rising inflation.
• D. All of the above.

Answer 1

Answer: (D)

All of the above.

Hoarding in economics refers to maintaining unaccounted stocks of many commodities to save guard oneself from rise in general price level i.e. inflation or to take advantage of future rise in prices. This creates artificial scarcity of commodities in the market which further increase the prices of the commodities, leading to inflation. This is a clear case of exploitation of the consumers and such a situation may create panic in the society.