Question

1. President Roosevelt believed that the loss of the NRA would be temporary as pressure would be exerted by ____ for a newer version.

a. businessmen

b. bureaucrats

c. politicians

d. voters

e. foreign tourists

2. The tax bill of 1935 is generally referred to as the:

a. “soak the rich” tax increase.

b. “soak the monopolies” tax increase.

c. “soak the speculator” tax increase.

d. “lesser burden on the middle class” tax decrease.

e. “lesser burden on the poor” tax decrease.

3. What changes did the Fed make in 1936 and 1937 that caused/contributed

to the depression of 1937?

a. They engaged in the open market sale of bonds.

b. They engaged in the open market purchase of bonds.

c. They raised the required reserve ratio on banks.

d. Both A and C of the above.

e. Both B and C of the above.

4. FDR’s acceptance speech for his party’s nomination to run for a second terms has been characterized as:

a. an attack on socialism.

b. an endorsement of socialism.

c. an endorsement of communism.

d. an endorsement of free enterprise.

e. an attack on free enterprise.

5. According to Smiley, which of the following is true about U.S. economic performance during World War II?

a. Unemployment fell and leveled off at about 5%.

b. Measured inflation was low, in part because of price controls and rationing.

c. The money supply grew by about 1% per year, keeping inflation low.

d. While the official data shows that consumption fell, Smiley calls that “suspect” and argues that in fact it rose significantly.

e. All of the above.

6. What does Smiley argue about World War II that helped the U.S. become prosperous in the 1940s?

a. More women entered, and stayed, in the labor force.

b. Military spending helped spur technological change.

c. Americans shifted from being pessimistic about the future to being optimistic.

d. The war helped promote increased world trade.

e. All of the above.

7. Which of the following does Smiley argue was not an outgrowth of the Great Depression?

a. The rise in the welfare state.

b. The growth in the regulatory state.

c. Increased federalism.

d. An end to the gold standard.

e. Increased power to individual states rather than the federal government.

Answer 1

1. Option A Businessmen

The National Recovery Administration (NRA) was a prime New Deal agency established by U.S. president Franklin D. Roosevelt (FDR) in 1933. The goal of the administration was to eliminate cut throat competition by bringing industry, labor, and government together to create codes of fair practices and set prices.

2. Option A soak the rich” tax increase

The 1935 Act also was popularly known at the time as the "Soak the Rich" tax. To solve the problem of tax evasion through loopholes, the Revenue Act of 1937 revised tax laws and regulations to increase the efficacy of the tax.

3.Option C they raised required reserve ratio of banks

Fed policymakers doubled reserve requirement ratios to soak up banks’ excess reserves (which is money above the amount banks were required to hold as a fraction of customers’ deposits) .This led to decrease in money supply severely.

4. Option E attack on free enterprise.

FDR's acceptance speech for his party's nomination for a second term was characterized as an attack on free enterprise. It was said that the Great Depression was the failure of America’s free-enterprise system.