The Decline in the Price Level Following the 1929 Stock

question 69

Multiple Choice

The decline in the price level following the 1929 stock market crash may have reduced household spending on durable goods and houses because the decline

• A)resulted in higher nominal interest rates.
• B)led the government to increase its spending, which crowded out spending by households.
• C)increased the real value of outstanding household debt.
• D)led to an offsetting decline in nominal wages.

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Definitions:

Dominant Strategy

In game theory, a strategy that is best for a player regardless of the strategies chosen by other players.

Wealth

An accumulation of valuable resources or material possessions that an individual, community, company, or country owns or controls.

Contribute

To give something, such as money, goods, or time, to a common fund or cause.

Benefit

Benefit refers to the positive impact or gain received from a product, service, or action, often used in comparison to costs to assess worthiness or efficacy.