Use the Following Graph to Answer the Following Questions

question 47

Multiple Choice

Use the following graph to answer the following questions.This graph depicts an economy where aggregate demand has decreased,with no change in either short-run aggregate supply (SRAS) or long-run aggregate supply (LRAS) .

-During the Great Depression,the aggregate price level and real gross domestic product (GDP) both decreased,as depicted in the graph.Unemployment increased to record levels.Which of the following best explains why this happened?

• A) A sudden increase in oil prices caused inflation and a deep recession.
• B) A stock market crash,large numbers of bank failures,an increase in tax rates,and a tight money supply caused a recession.
• C) A rapid decline in housing prices led to problems in the loanable funds market and a recession.
• D) A significant decline in military spending following the end of a war led to a recession.
• E) A sharp recession followed the United States abandoning the gold standard.

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Definitions:

Congress

The national legislative body of the United States, consisting of two houses: the Senate and the House of Representatives.

Republican Motherhood

The idea that women's role was to cultivate civic virtue in their children, thereby contributing to the health of the republic, emphasized in the United States during the late 18th century.

Political Policies

Plans, actions, or strategies that are implemented by a government, political party, or leader to achieve specific outcomes or goals.

New Republic

Refers to a period or state entity formed after breaking away from a previous form of government, often associated with revolutions or major political changes.