Great Depression Study Guide

Question 1

What is a Bull Market?

Answer 1

A long period of rising stock prices; there was one in the late 1920s

Question 2

What is buying on a margin?

Answer 2

When a buyer only puts down 10-20% of the money and borrows 80-90% of the cost

Question 3

What was Black Tuesday?

Answer 3

The stock market plummeted completely and lost over ten billion dollars

Question 4

When did the stock market crash?

Answer 4

September 1929

Question 5

What are the causes of the Great Depression?

Answer 5

Overproduction, the Hawley-Smoot Tariff, and mistakes from the Federal Reserve

Question 6

How did overproduction contribute to the Great Depression?

Answer 6

Factories and farms were producing more goods than people were buying

Question 7

What was the Hawley-Smoot tariff? How did it contribute to the Great Depression?

Answer 7

The act raised the average tariff rate, leading to other countries increasing their own tariffs on American goods. It reduced international trade, causing global trade to plummet.

Question 8

How did the federal reserve’s mistakes contribute to the Great Depression?

Answer 8

The Federal Reserve failed to raise interest rates and essentially let the banking system collapse

Question 9

What was daily life like for people during the Great Depression?

Answer 9

There were bread lines and soup kitchens set up by private organizations like the YMCA. Many people were evicted so they either fled by “riding the rails” or joined shantytowns.

Question 10

Who was the president when the Great Depression began? How did he respond to the Depression?

Answer 10

Herbert Hoover, who responded with a collection of programs like the Reconstruction Finance Corporation

Question 11

What was the Reconstruction Finance Corporation (RFC)?

Answer 11

The RFC made loans to businesses; it provided financial aid to railroads, financial institutions, and business corporations.

Question 12

What is relief?

Answer 12

Money given directly to impoverished families

Question 13

What was the Bonus Army?

Answer 13

A group of marching veterans petitioning a bill for the early payment of bonuses

Question 14

What were Hoovervilles?

Answer 14

Shantytowns during the Great Depression; they were named after the president because the homeless blamed him for their problems

Question 15

What was the New Deal?

Answer 15

Roosevelt’s policies for ending the depression

Question 16

What were bank holidays?

Answer 16

Roosevelt’s system in which he closed banks to prevent them from collapsing

Question 17

What famous quote did Roosevelt say about the bank holidays?

Answer 17

“the only thing we have to fear is fear itself”

Question 18

What were the Hundred Days?

Answer 18

The time period in which Congress passed 15 acts to resolve the economic crisis.

Question 19

What were Fireside Chats?

Answer 19

Roosevelt’s addresses to the nation (via radio) to explain what he was trying to accomplish

Question 20

What did the Federal Deposit Insurance Corporation (FDIC) do?

Answer 20

It provided government insurance for bank deposits (up to a certain amount)

Question 21

What did the Securities and Exchange Commission (SEC) do?

Answer 21

It regulated the stock market and prevented fraud

Question 22

What did the Agricultural Adjustment Administration (AAA) do?

Answer 22

It paid farmers NOT to raise certain livestock and certain crops.

Question 23

What did the Tennessee Valley Authority (TVA) do?

Answer 23

It provided jobs and electricity to the Tennessee Valley area.

Question 24

What did the Civilian Conservation Corps (CCC) do?

Answer 24

It offered unemployed young men jobs like planting trees, fighting forest fires, and building reservoirs.

Question 25

What is deficit spending?

Answer 25

Abandoning a balanced budget and borrowing a lot of money instead.

Question 26

What did the Works Progress Administration (WPA) do?

Answer 26

It employed job-seekers to carry out public works (building highways, public buildings, parks)

Question 27

What did the Social Security Act do?

Answer 27

It provided security for older Americans and unemployed workers.

Question 28

Who was Frances Perkins?

Answer 28

The first woman to be in the US Presidential Cabinet; she was the Secretary of Labor

Question 29

What was court-packing?

Answer 29

Roosevelt’s idea to add more justices to the supreme court in hopes of gaining more votes in favor of New Deal programs.

Question 30

What was John Maynard Keynes’ argument?

Answer 30

He thought the government should spend heavily during recession (decline in employment and production)

Question 31

What was the main critique of the New Deal?

Answer 31

It made the government too powerful

Question 32

What is the legacy of the New Deal?

Answer 32

It gave many Americans a stronger sense of security and stability