The Tariff Policy of the Early 1920s

question 81

Multiple Choice

The tariff policy of the early 1920s:

• A) made it easier for other nations to sell to the United States
• B) made it harder for other nations to sell to the United States
• C) made it easier for other nations to repay their war debts
• D) led Americans to cut back on loans and investments abroad
• E) had virtually no effect on the average American but significantly limited businesses

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Definitions:

Classical Model

An economic theory emphasizing that markets function best without government interference, focusing on long-term growth by ensuring goods and labor markets are in equilibrium.

Aggregate Supply

The sum of all products and services that enterprises in an economy expect to sell during a defined time span.

Price Level

The mean of current prices for all goods and services generated within the economy.

Keynesian Theory

An economic theory proposing that active government intervention in the marketplace and monetary policy is the best method of ensuring economic growth and stability.