When the Price of a Financial or Real Asset Rises

question 167

Multiple Choice

When the price of a financial or real asset rises much more rapidly than prices in general,we have a(n)

• A) negative wealth effect.
• B) increase in the marginal propensity to consume.
• C) asset price bubble.
• D) fundamental change in supply.
• E) fundamental change in demand.

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Definitions:

Distributors

Entities involved in the process of making products available for consumption by distributing them from producers to end consumers.

Fair Value Option

An accounting approach allowing companies to report certain assets and liabilities at fair market values rather than historical costs.

Fair Value Option

An accounting choice to measure certain financial assets and liabilities at fair market values.

Receivables Growth

An increase in the amount of money owed to a company by its customers for products or services that have been delivered or used but not yet paid for.