Answer
<u>A bubble is a phenomena in investing that occurs when investors increase their demand in assets so much that they cause the price to move to a value beyond accurate reflection of its actual worthiness</u>. When a bubble happens, <u>the prices of stock will fall rapidly</u>.When there is increase in the share price of stock rapidly caused by individual-perpetuating, the share value can rise beyond asset value making investor to withdraw their money faster because <u>supply will exceed demand and cause share price to fall.</u>
An increase demand on assets by investors will make the price to increase beyond rational economic value. The real worth of the stock will now be determined by firm’s performance. Investing in bubble can appear to last forever, but because they are formed by self-perpetuated reasons, they eventually fall and the money that was invested into them is lost. In such cases, investors would run to withdraw their money and avoid the loss of fall in share prices.
With prestige goods and services, a higher price may, but not always, result in a higher sales volume.
<h3>What do economists mean by prestige goods?</h3>
Numerous products and services have prestige value, elevating the standing of their owners or users. Such items are referred to be prestige (or status, or positional) goods. These prestige products include things like jewelry, designer apparel, expensive homes and vehicles, and lavish entertainment.
<h3>Why is the demand curve for prestige items different?</h3>
Prestige goods may actually see an increase in demand as a result of price increases since customers perceive them to be more value. The demand curve slopes upward in certain circumstances.
To know more bout Prestige products visit:
brainly.com/question/6374886
#SPJ4
Answer:
a movement up and to the right along the supply curve for oranges.
Explanation:
The supply curve exhibits the price and quantity.
Quantity on the x axis that reflects the quantity supplied.
Price on the y axis that reflects the price at which the particular commodity is offered.
Accordingly, when there is increase in prices of orange the y axis will move upward, also as there is increase in price the suppliers would supply more at the price, accordingly x axis will also grow.
Accordingly the supply graph will move upward in the right direction.
Answer:
M1 $2,530 billion
M2 $10,644 billion
Explanation:
- M1 = Currency held + Travelers check + Checkable deposits
= $(1,124 + 4 + 1,402) billion = $2,530 billion
- M2 = M1 + Savings deposits + Time deposits + Money market funds
= $(2,530 + 6,884 + 583 + 647) billion = $10,644 billion
Answer:
c. money supply to rise. To reduce the impact of this the Fed could sell Treasury bonds.
Explanation:
Since in the question it is given that the bank has decided to hold fewer reserves that contain excess reserves as compared to deposits so for this they have to borrowed the amount or the saving amount should be invested
This results in declining in interest rate which causes the money supply risen also the demand and the investment for the nation has risen that develop the inflation but for declining the inflation the FED has to sell the bonds so that it comes at equilibrium point again
