Final answer:
Tulipmania led to massively inflated prices for tulip bulbs in the 1600s due to their status as desirable and scarce items. The main idea concerns the price changes during this period, with the overly broad statement discussing price inflation in general and the too narrow statement specifying an exact price for some bulbs.
Step-by-step explanation:
The discussion at hand pertains to a historical event known as Tulipmania, which occurred first in the Dutch Republic during the early 17th century and later in the Ottoman Empire. To answer the student's question:
- The main idea is that the price for tulip bulbs rose extravagantly and then fell sharply in the early 1600s.
- The statement that is too broad is that prices will rise on anything that is scarce and desirable.
- The statement that is too narrow is that some tulip bulbs sold for over $2,000 a piece.
During Tulipmania, tulips became a status symbol and their bulbs were highly sought after, which drove prices to unprecedented levels. This event is often cited as one of the first recorded speculative bubbles in history, showcasing how desire and scarcity can lead to the rapid inflation of prices. Over time, however, the market adjusted and prices fell, illustrating the volatile nature of speculative markets.