Question
Rent-seeking and Bubbles [10 marks] Refer to the following news articles on 'Dogecoin': 1.David Chau(2021), Dogecoin 'bubble' surges ahead of Elon Musk's debut on Saturday
Rent-seeking and Bubbles [10 marks]
Refer to the following news articles on 'Dogecoin':
1.David Chau(2021), "Dogecoin 'bubble' surges ahead of Elon Musk's debut on Saturday Night Live",ABC News, May 07, available:https://www.abc.net.au/news/2021-05-07/dogecoin-elon-musk-tesla-snl-to-the-moon-doge/100113706
2.James Purtill (2021), "Some Australians have made a fortune on Dogecoin, but they say it's not all about the money",ABC News, May 21, available:https://www.abc.net.au/news/science/2021-05-21/dogecoin-cryptocurrency-stories-of-australians-who-made-money/100144664
Based on this discussion in the articles and relevant microeconomic theory, explain the endogenous processes at work of the Dogecoin bubble. Use relevant demand and supply diagrams to aid your answer and show how there is an unstable equilibrium.
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Cambridge International AS And A Level Economics Coursebook
Authors: Colin Bamford, Susan Grant
3rd Edition
1107679516, 978-1107679511
