The two types of asset-price bubbles are ________ and ________ bubbles.
A) credit-driven; debt driven
B) rational; optimistic
C) irrational exuberance; optimistic
D) credit-driven; irrational exuberance

Question

Quizplus · Accepted Answer

The two types of asset-price bubbles are credit-driven and irrational exuberance bubbles. Credit-driven bubbles occur when there is easy availability of credit or low-interest rates, which lead to increased borrowings and demand for assets, leading to an increase in prices. Irrational exuberance bubbles occur when asset prices rise because of excessive optimism rather than fundamental factors, such as earnings or economic growth.

The Two Types of Asset-Price Bubbles Are ________ and ________

The Two Types of Asset-Price Bubbles Are and