When a "bubble" arises, asset prices are driven by:

select one:

a. policymakers.

b. changes in aggregate demand and aggregate supply.

c. shifts in money growth rate.

d. shifts in market psychology and successive waves of irrational exuberance.

d. shifts in market psychology and successive waves of irrational exuberance.

Explanation:

Bubble in respect to financial market means an unexpected and non-explainable reason. This although the economists believes arises because of the emotional attachment and effects on an asset. As for example: when an asset is made using the specific raw material which is discovered to be precious in the terms it is ancient then, automatically the price of the asset increases in the market.

Thus, this is nothing but a market psychology that is basically an effect of emotional concerns of individual mindset, which is irrational.

This theory is explain by Keynesian the economists.

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