The Great Depression! MCQ Trivia

1. People lost their jobs and could not afford to live in their homes.

True

False

The statement suggests that people lost their jobs, which resulted in them being unable to afford their homes. This implies that they had to either find alternative living arrangements or face homelessness. Therefore, the statement is true as it accurately reflects the situation described.

Explanation

The statement suggests that people lost their jobs, which resulted in them being unable to afford their homes. This implies that they had to either find alternative living arrangements or face homelessness. Therefore, the statement is true as it accurately reflects the situation described.

2. The Great Depression was caused by what major event?

An increase in federal spending.

The stock market crash.

Automobile workers going on strike.

President Hoover announcing a war.

The Great Depression was caused by the stock market crash. This event, known as Black Tuesday, occurred on October 29, 1929, when the stock market experienced a sudden and severe decline. This led to a loss of confidence in the economy, causing investors to sell their stocks and triggering a chain reaction of financial collapse. The crash resulted in widespread unemployment, bank failures, and a severe economic downturn that lasted throughout the 1930s.

Explanation

The Great Depression was caused by the stock market crash. This event, known as Black Tuesday, occurred on October 29, 1929, when the stock market experienced a sudden and severe decline. This led to a loss of confidence in the economy, causing investors to sell their stocks and triggering a chain reaction of financial collapse. The crash resulted in widespread unemployment, bank failures, and a severe economic downturn that lasted throughout the 1930s.

3. An increase in federal spending ended the Great Depression.

True

False

The statement that an increase in federal spending ended the Great Depression is false. In reality, it was the implementation of various policies and programs, such as the New Deal, that helped to alleviate the effects of the Great Depression. These policies included government spending, but it was not solely responsible for ending the economic downturn. Other factors, such as World War II and increased industrial production, also played significant roles in bringing an end to the Great Depression.

Explanation

The statement that an increase in federal spending ended the Great Depression is false. In reality, it was the implementation of various policies and programs, such as the New Deal, that helped to alleviate the effects of the Great Depression. These policies included government spending, but it was not solely responsible for ending the economic downturn. Other factors, such as World War II and increased industrial production, also played significant roles in bringing an end to the Great Depression.

4. The unemployment rate was 11.7% in 1921.

True

False

In 1921, the unemployment rate was indeed 11.7%. This suggests that a significant portion of the population was without work during that time.

Explanation

In 1921, the unemployment rate was indeed 11.7%. This suggests that a significant portion of the population was without work during that time.

5. The Consumer Price Index indicates the amount of money spent by who?

The Consumer Price Index measures the average change in prices over time for a basket of goods and services typically purchased by consumers. Therefore, it is logical to conclude that the amount of money spent is by the consumers themselves.

Explanation

The Consumer Price Index measures the average change in prices over time for a basket of goods and services typically purchased by consumers. Therefore, it is logical to conclude that the amount of money spent is by the consumers themselves.

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6. When the stock market indicates an increase and then something happens to a company, what possible events could happen?

Stock prices rise, inflation drops and employment rises.

Employment rises, inflation drops and stocks remain the same.

Everything remains the same.

Stock prices could drop, inflate could increase and unemployment rises causing a depression.

If the stock market indicates an increase and then something happens to a company, it is possible that stock prices could drop, inflation could increase, and unemployment could rise, leading to a depression. This is because the event that happened to the company could have a negative impact on the overall economy, causing a decrease in stock prices, an increase in inflation, and a rise in unemployment. These factors combined can contribute to a period of economic downturn known as a depression.

Explanation

If the stock market indicates an increase and then something happens to a company, it is possible that stock prices could drop, inflation could increase, and unemployment could rise, leading to a depression. This is because the event that happened to the company could have a negative impact on the overall economy, causing a decrease in stock prices, an increase in inflation, and a rise in unemployment. These factors combined can contribute to a period of economic downturn known as a depression.

7. What world event happened during the Great Depression that caused an increase in government spending?

During the Great Depression, World War 1 occurred, which led to an increase in government spending. The war created a demand for military equipment, supplies, and personnel, causing the government to allocate more funds towards defense and war efforts. This increased spending helped stimulate the economy and provided employment opportunities for many people who were struggling during the Depression.

Explanation

During the Great Depression, World War 1 occurred, which led to an increase in government spending. The war created a demand for military equipment, supplies, and personnel, causing the government to allocate more funds towards defense and war efforts. This increased spending helped stimulate the economy and provided employment opportunities for many people who were struggling during the Depression.

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8. The Federal Reserve loosened the money supply to help stop the Great Depression.

True

False

The statement is false because the Federal Reserve actually tightened the money supply during the Great Depression, which worsened the economic crisis. This contractionary monetary policy led to a decrease in the money available for lending and investment, further exacerbating the already severe economic downturn. The Federal Reserve's actions were widely criticized for contributing to the prolonged duration and severity of the Great Depression.

Explanation

The statement is false because the Federal Reserve actually tightened the money supply during the Great Depression, which worsened the economic crisis. This contractionary monetary policy led to a decrease in the money available for lending and investment, further exacerbating the already severe economic downturn. The Federal Reserve's actions were widely criticized for contributing to the prolonged duration and severity of the Great Depression.

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