Author Question: What form of irrational behavior can cause asset price bubbles? A) People do not based their ... (Read 31 times)

B · **on:** Jul 1, 2018

What form of irrational behavior can cause asset price bubbles?

A) People do not based their investment decision on the fundamental value of the asset but only on the belief that the asset price will continue to increase.
B) People accidentally buy assets that they did not want, and this drives up the asset price.
C) Asset owners panic and begin to sell their assets as quickly as possible.
D) People throw darts at a list of stocks and buy whatever the dart lands on without thinking about the reasons.

Question 2

Based on Figure 4.1, food is:

A) a normal good.
B) an inferior good, but not a Giffen good.
C) a Giffen good.
D) none of the above