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What Are Extrapolative Expectations,and Why Are They Essential for the Formation

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What are extrapolative expectations,and why are they essential for the formation of a bubble?


Definitions:

Common Shares

Equity securities that represent ownership in a corporation, giving holders voting rights and a share in the company’s profits via dividends.

Internet Companies

Businesses that operate primarily on the internet, offering services or products through digital platforms, often focusing on technology, e-commerce, or social media.

Growth Opportunities

Potential scenarios or projects that can increase the profitability and size of a business.

Earnings Yields

The inverse of the price-to-earnings ratio, representing the earnings generated by a company per share relative to its share price, often used to compare the profitability of investments.

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