Unit 7 Quiz Review (Great Dep. & New Deal)

What forced banks to close during the Great Depression?

• Huge amounts of inflation

• War in Europe

• Investors unable to pay loans and bank runs

• Not enough people invested in the Stock Market

How did an economic recession help cause the Great Depression?

• Americans bought less, causing less demand for goods

• Bank runs caused depositors to withdraw all their money from banks

• The market bubble popped, crashing Wall Street

• Low interest rates encouraged risky speculation

What caused many farmers to foreclose on their farms in the 1930s?

• Growing too few crops

• Overproduction of crops and costs of machines

• Expensive land and not enough workers

• The Wall Street Crash

Which of the following was not a cause of the Great Depression?

• Excessive American loans to European countries

• Installment buying

• Uneven distribution of wealth

• Purchasing of stocks "on margin"

The stock market crash weakened the nation’s banks because

• banks had invested their deposits in the stock market.

• investors no longer had money to deposit in banks.

• banks depended on their stock for operating funds.

• investors could no longer afford to take out loans from banks.

At the time of the stock market crash, the government did not insure bank deposits, so

• banks kept only a fraction of depositors’ money in reserve.

• customers lost their savings if a bank collapsed.

• banks had to make money by making loans and investing.

• customers turned to their stockbrokers for help.

What forced banks to close during the Great Depression?

• Huge amounts of inflation

• War in Europe

• Investors unable to pay loans and everyone trying to withdraw their money at the same time.

• Not enough people invested in the Stock Market

What were two basic causes of the Dust Bowl during the early 1930s?

• strip mining and toxic waste dumping

• over farming and severe drought

• clear-cutting of forests and construction of railroads

• overpopulation and urban sprawl

Which TWO answers best describe President Herbert Hoover's presidency during the Great Depression?

• A very hands-on government

• Mostly hands-off government

• Largely unable to better economic conditions

• Created many programs to help the poor.

One difference between the administrations of President Roosevelt and President Hoover was that Roosevelt was-

• more willing to use government intervention to solve economic problems
• unwilling to allow government agencies to establish jobs
• able to ignore economic issues for most of his first term in office
• opposed to any type of government regulation of financial institutions