Great Depression Review

Which term describes a situation where asset prices are driven to levels that are not supported by fundamentals?

• 1. a financial strategy focused on long-term investment in stable assets

• 1. an economic bubble

• 1. the practice of diversifying investment portfolios to manage risk

• 1. a government policy aimed at controlling inflation

Which factor contributed significantly to the onset of the Great Depression by reducing purchasing power?

• increase in tariffs

• bank failures

• underconsumption

• government spending

1. Which event directly preceded the Great Depression, marking the beginning of a severe economic downturn?

• Implementation of the New Deal

• Stock Market Crash of 1929

  
  

• World War I

•  Discovery of the gold standard's limitations

  
  

1. Following the 1929 stock market crash, how did the Hoover administration attempt to address the ensuing economic downturn?

• Introduced measures to directly support failing banks and financial institutions

• Launched extensive social welfare programs to aid the unemployed

• Encouraged the Federal Reserve to cut interest rates to promote investment

• Urged the Federal Reserve to increase interest rates to stabilize the currency

1. What was President Hoover's stance on federal government's role in providing relief during the Great Depression?

• He believed in a strong, direct intervention by the federal government

• He supported a limited federal role, emphasizing local and private charity efforts

• He pushed for extensive federal welfare programs

• He advocated for significant tax increases to fund relief efforts

1. What action did President Franklin D. Roosevelt take to ensure the safety of individual deposits in banks during the Great Depression?

• By signing the Banking Act of 1933 into law

• By personally guaranteeing deposits

• By allowing banks to issue new stock

• By removing the United States from the gold standard

1. Which New Deal program was responsible for building infrastructure projects such as roads and bridges?

• Public Works Administration

• Social Security Act

• Works Progress Administration

• National Recovery Administration

1. Which of the following was a criticism of the New Deal programs?

• They were ineffective in providing relief to unemployed workers

• They focused too heavily on government intervention and regulation

• They did not address the root causes of the Great Depression

• They led to increased poverty and economic inequality

1. How did the Great Depression impact the role of the federal government in the economy?

• Decreased government spending on social welfare programs

• Allowed for unrestricted laissez-faire capitalism

• Led to increased government intervention and regulation

• Resulted in the privatization of key industries

The overuse of _______ led to Great Depression.

• deodorant

• mechanized farming techniques

• credit

• alcohol