According to Robert Shiller, Speculative Bubbles Are Difficult to Predict

question 84

Multiple Choice

According to Robert Shiller, speculative bubbles are difficult to predict because:

• A)they depend on the existence of a particular pattern of thinking which is difficult to predict.
• B)they are totally random events.
• C)they arise because of government regulatory activity which is difficult to predict.
• D)turns in business cycles are difficult to predict.

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Definitions:

Central Direction

The control of economic or organizational activity by a central authority or government.

Past Income

The amount of money earned in preceding periods, often used to assess financial stability or creditworthiness.

Inheritance

Assets received from someone who has died, transferring wealth or obligations from the deceased to their legal heirs or beneficiaries.

Federal Governments

A system of government where power is divided between a national (federal) government and various regional governments.