In an Asset Bubble

Multiple Choice

In an asset bubble:

A) depositors withdraw their deposits from banks until the bank fails.
B) the price of an asset is pushed to an unreasonably high level because of expectations of further price gains.
C) the price of an asset falls because demand for the asset is so high.
D) savers and investors engage in maturity transformation by long-term borrowing and making short-term loans to take advantage of interest rate increases.