Great Depression Flashcards
(38 cards)
in what year did the stock market crash?
1929
in what year did the stock market hit the bottom?
1932
from 29-32, the GDP went down ____%
25%
from 29-32, the official U went up ___%
25%
What was the actual U during the great depression?
40% (25% official unemployed + 15% discouraged workers)
from 29-32, prices were down ____%
25%
why were the prices down so much during the Great Depression?
prices went down 25% during the Great Depression because the government told people to put everyone on sale
from 29-32, wages went down ___%
25%
what is the nominal wage rate
among of money people make
W/P =
constant, real wage
what is the real wage? and what happened to is during the GD?
W/P
real wage stayed the same during the GD because both W and P went down 25% during the GD
from 29-32, stocks went down ___%
85%
how much did the stock market fall in one day in October 29?
11%
how much did the stock then fall in the autumn of 29?
40%
what year did the stock finally make it back up to where it was in 29?
1951
it took __ years (____) for the GDP to get back to where it was in ___
it took 10 years (1939) for the GDP to get back to where it was in 1929
from 32-39, U was ___% or ___%
17% or 18%
why was unemployment so high from 32-39?
because there were no new jobs in 10 years, but many new workers
financial intermediation
finding borrowers for savings (banks)
financial intermediaries
banks, etc.
financial disintermediation
when a lot of savings aren’t borrowed/spent
Millers Fundamental Principle Macro
if some savings is not borrowed/spent, then some output is not bought and output will fall
GDP is approximate to _____
- therefore all income must be spend or else some ____ will go unsold
- some people ____
- therefore all ____ must be ______
GDP is approximate to earned income
- therefore all income must be spent or else some output will go unsold
- some people save
- therefore all savings must be borrowed
Causes of GD
- stocks fell
- severe drought
- banks close
- financial disintermediation
- Polish Gma Kovalesky
- Gold Standard
- Smoot-Howley Tariff
- Deflation
