|An economic bubble (sometimes referred to as a speculative bubble, a market bubble, a price bubble, a financial bubble, or a speculative mania) is “trade in high volumes at prices that are considerably at variance with intrinsic values”.
Because it is often difficult to observe intrinsic values in real-life markets, bubbles are often identified only in retrospect, when a sudden drop in prices appears. Such a drop is known as a crash or a bubble burst. Prices in an economic bubble can fluctuate erratically, and become impossible to predict from supply and demand alone.
Examples of economic bubbles include:
Directions: Write a research report on any of the economic bubbles listed above. In your report, include a description of the bubble, its causes and effects.