Asset price bubbles are not sustainable because:
A)people realize that leverage really doesn't work mathematically.
B)invariably the government steps in to burst the asset price bubble.
C)investors eventually run out of assets with which to purchase the good.
D)they do not reflect an increase in the real productive value of the asset.

Question

Quizplus · Accepted Answer

Asset price bubbles are unsustainable because they are based on speculative increases in prices rather than on the underlying real productive value of the asset. When prices are driven up by speculation rather than actual value, the bubble is likely to burst once it becomes clear that the prices are not supported by fundamentals.

Asset Price Bubbles Are Not Sustainable Because