Following the banking crises of the early 1930s real GDP _____ and the price level _____.
A)increased; increased at a rapid pace
B)increased; decreased
C)decreased; decreased
D)decreased; increased

Question

Quizplus · Accepted Answer

The banking crises of the early 1930s led to a decrease in real GDP and a decrease in the price level. This was a result of the decrease in demand due to reduced lending and a decrease in the money supply, which led to deflationary pressure on prices.

Following the Banking Crises of the Early 1930s Real GDP