The "Greater Fool" Theory Assumes That

question 52

Multiple Choice

The "greater fool" theory assumes that

• A)markets are efficient.
• B)bubbles cannot exist in well-organized markets.
• C)an investor is not a fool to buy an asset as long as there is a greater fool to buy it later for a higher price.
• D)bond market returns are always above stock market returns.

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Definitions:

Globalization

The increasing interconnectedness and interdependence of the world's markets and businesses, facilitated by advancements in transportation, communication, and technology.

Tax Bases

The total amount of assets or income that can be taxed by a government, forming the foundation for calculating tax liabilities.

Services

Intangible products or actions that provide value to consumers, differing from goods which are physical items.

Federal Government

The national government of a federal country, which shares sovereignty with constituent states or provinces, responsible for governing national matters.