An asset-price bubble is caused by:
A) people buying assets because they believed prices would keep going up and they'd be able to sell for a profit.
B) fads that make owning a certain asset fashionable.
C) severe inflation within a short period of time.
D) the increase in the value of durable goods when the economy is experiencing low inflation.

Question

Quizplus · Accepted Answer

An asset-price bubble is caused by people buying assets because they believed prices would keep going up and they'd be able to sell for a profit. This demand for the asset drives up its price, leading others to believe they should also invest, which further drives up the price until it becomes unsustainable and eventually crashes.

An Asset-Price Bubble Is Caused By