What Order of Events Led to the Real Shock in Banking

question 102

Multiple Choice

What order of events led to the real shock in banking that occurred during the Great Depression?

• A) A reduction in the productivity of financial institutions led to a decrease in money supply that led to bank failures that led to a reduction in aggregate demand.
• B) Bank failures led to a decrease in money supply, which led to a reduction in the productivity of financial institutions that resulted in the fall of aggregate demanB.
• C) A fall in money supply led to a reduction in aggregate demand that caused bank failures and led to a reduction in the productivity of financial institutions.
• D) None of the answers is correct.

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Average Fixed Cost

The fixed costs, such as rent or salaries, divided by the number of units produced, calculated over a period of time.

Mixers

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Average Total Cost

The total cost of production divided by the number of units produced, including both fixed and variable costs.

Range of Output

Refers to the variety of products or services produced by a company or industry.