Which of the Following Is an Important Lesson That Can

question 42

Multiple Choice

Which of the following is an important lesson that can be drawn from the experience of the Great Depression?

• A) Frequent shifts in monetary policy can help smooth out unstable economic conditions during a recession.
• B) Trade restrictions can "save jobs" and expand total employment during an economic downturn.
• C) The good intentions of political decision-makers are no substitute for sound policy.
• D) The federal government should always balance its budget during a recession.

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Definitions:

No-par Shares

Stocks issued without a specified face value, where the value is determined by the price investors are willing to pay for them.

Stock Subscription

An agreement to purchase a specified number of shares in a company, often before they are available to the general public.

Board Of Directors

A group of individuals elected to represent shareholders and oversee the management and major decisions of a corporation.

Stock Warrants

Financial instruments that give the holder the right, but not the obligation, to buy shares of a company at a specified price before the warrant expires.