How did people understand when Shakespeare "coined" a word?

by jrrybock

I came across a reference that Shakespeare made up the word 'quarrel', and he's certainly famous for originating many new words. Is that just because he wrote them down as dialogue, but people used them all the time? If they were truly original, how would people have understood them? Purely through context clues, or were they often plays on other known words?

BuenaventuraBaez