Asset Price Bubble: Definition & Model

Instructions:

Choose an answer and hit 'next'. You will receive your score and answers at the end.

question 1 of 3

Asset price bubbles occur when _____.

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1. During the tulip mania in 16th-century Holland, the price of tulip bulbs _____.

2. Which of the following would cause a house flipper to believe he will profit from buying a property and then selling it quickly?

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About This Quiz & Worksheet

Use the worksheet and quiz to see just how much you know about asset price bubbles. How these bubbles occur and the herd theory are topics you need to know in order to do well on the quiz.

Quiz & Worksheet Goals

The goal of these materials is to check your understanding of:

  • When asset price bubbles occur
  • The market where the herd theory could explain the presence of inflated prices
  • Theory that would explain why house flippers buy and sell properties quickly
  • Something that would encourage the formation of an asset price bubble in the housing market

Skills Practiced

  • Reading comprehension - ensure that you draw the most important information from the lesson on asset price bubbles
  • Information recall - access the knowledge you have gained about what happened to the price of tulip bulbs during Holland's tulip mania in the 16th century
  • Interpreting information - verify that you can read information about when asset price bubbles occur and interpret it correctly

Additional Learning

You can review more about these bubbles if you access the lesson called Asset Price Bubble: Definition & Model. Other topics you can study and review include:

  • How asset price bubbles work
  • Determining what assets are really worth
  • What risk shifting is
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