Which of the following describes policies used in the United States and Europe during the 1930s that worsened the Great Depression?
A. Increasing taxes on imported goods and cutting government spending
B. Establishing command economies and building up large military forces
C. Closing stocks markets and replacing them with government owned banks
D. Hiring more government workers and launching construction projects
Answers
The correct answer to your question is option (A)
Increasing taxes on important goods and cutting government spending.
The day October 31 of 1929 was the black day in American history because that had induced the longest economic depression in the western world which can also be known as the Great Depression of 1929-1939.
On 29th October of 1929, NYSE lost billions of dollars and lost many of its investors as the investors traded some 16 million shares on the NYSE. This ultimately led to the fall of NYSE.
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Causes of the Great Depression
1. Financial exchange Crash of 1929 - Many accept mistakenly that the securities exchange crash that happened on Black Tuesday, October 29, 1929, is one and the equivalent with the Great Depression. Truth be told, it was one of the real causes that prompted the Great Depression. Two months after the first accident in October, investors had lost more than $40 billion dollars. Despite the fact that the financial exchange started to recover a portion of its misfortunes, before the finish of 1930, it simply was most certainly not enough and America genuinely entered what is known as the Great Depression.
2. Bank Failures - Throughout the 1930s more than 9,000 banks fizzled. Bank stores were uninsured and in this way as banks fizzled individuals basically lost their reserve funds. Enduring banks, uncertain of the financial circumstance and worried for their own survival, quit being as eager to make new credits. This exacerbated the circumstance prompting less and less uses.
3. The decrease in Purchasing Across the Board - With the securities exchange crash and the feelings of trepidation of further monetary hardships, people from all classes quit obtaining things. This at that point prompted a decrease in the number of things delivered what's more, along these lines a decrease in the workforce. As individuals lost their positions, they were unfit to stay aware of paying for things they had purchased through portion plans and their things were repossessed. Increasingly more stock started to collect. The joblessness rate transcended 25% which implied, obviously, even less spending to help reduce the monetary circumstance.
4. American Economic Policy with Europe - As organizations started coming up short, the legislature made the Smoot-Hawley Levy in 1930 to help ensure American organizations. This charged a high assessment for imports in this manner prompting less exchange among America and outside nations alongside some monetary striking back.
5. Dry season Conditions - While not an immediate reason for the Great Depression, the dry season that happened in the Mississippi Valley in 1930 was of such extents that many couldn't cover their regulatory obligations or different obligations and needed to pitch their homesteads for no benefit to themselves.