Describe the series of events referred to as the “tulip mania” in general economic terms. Abstract away from the specific situation and dig for the deeper underlying process of the mania. Explain how/why one economic event led to the next.
We know that tulip mania means tulip is introduced on a large scale by many of the people. Hence, the tulip price shoots up massively. So it sold higher prices than the skilled workers earn. After the prices are in up, then crash and tulip holders become bankrupt. This is the first economic bubble.
The tulip mania generally considered an economic bubble. People are investing in an asset because of the higher price. It leads to an increase in the price of that asset at the peak level after reaching the peak the price of that asset crash because of higher sell. And finally, the asset holders become bankrupts. This kind of asset is commonly called tulips.
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