How do external shocks typically manifest in the economy?

External shocks typically manifest in the economy through sudden shifts in production, making this the correct choice. These shocks can originate from various sources, such as natural disasters, geopolitical events, or financial crises, leading to abrupt changes in supply or demand. For example, a natural disaster might destroy infrastructure, resulting in a sharp decline in production capacity for affected industries.

This sudden disruption can lead to fluctuations in prices and output, as businesses may struggle to meet demand or may need to adjust their operations rapidly. Such shifts can also affect employment levels and overall economic growth, highlighting the immediate and often severe impact these external factors can have on an economy.

In contrast, prolonged periods of growth and predictable economic cycles do not reflect the nature of external shocks, as these scenarios imply stability and continuity rather than sudden interruptions. Stabilizing market prices is also inconsistent with the effects of external shocks, which usually create volatility rather than stability.