A bubble or panic generally occurs in the stock market because of:
a. upswings in the business cycle.
b. expansionary monetary policies undertaken by the government.
c. irrational, or abnormal forecasts, or market valuations.
d. an increase in the profitability of the firms.
e. deliberate government actions to control inflation.
c
You might also like to view...
Suppose that goods X and Y are substitutes and the price of good Y falls. We would then expect
A) the quantity of good Y demanded to increase and the demand for good X to increase also. B) an increase in the demand for good X and a decrease in the quantity of good Y demanded. C) an increase in the quantity demanded of good Y and a decrease in the demand for good X. D) an increase in the demand for both good X and good Y.
Three gas stations are located at different corners of a busy intersection. Kelly manages one of them, and he notices that when he raises his gas prices, the other stations don't follow suit, but that when he cuts his gas prices, his competitors follow. What does demand for Kelly's gas look like, and how should he respond to a change in the wholesale price of gasoline?