In a rational bubble,investors can have ________ expectations that a bubble is occurring but continue to hold the asset anyway.
A)irrational
B)adaptive
C)rational
D)myopic

Question

Quizplus · Accepted Answer

In a rational bubble, investors may have the rational expectation that a bubble is occurring, yet they continue to hold the asset due to the belief that they can sell it to someone else at an even higher price in the future. This behavior is rational because it is based on the expectation of future gains, rather than irrational beliefs or emotions.

In a Rational Bubble,investors Can Have ________ Expectations That a Bubble