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Analyze the Role of "Animal Spirits" on Financial Bubbles

Question 7

Multiple Choice

Analyze the role of "animal spirits" on financial bubbles.


A) Banks produce bubbles by purchasing property at incredibly low rates and reselling that property to unsuspecting investors.
B) Financial markets tend to produce "bubble" investments that let people ignore risk, leading to alternating manias and panics.
C) The finance industry experiences massive eruptions of wealth that coincide with booms in other industries.
D) Wall Street functions on an intuitive basis, as investors cannot predict the value of volatile stocks.

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