According to Walton and Rockoff, the primary reason for the demise of the canal system was
a. excessive reliance on individual entrepreneurs so that a system of canals was never created.
b. excessive government regulation that kept canal rates and profits too low.
c. environmental damage from deforestation that left canals flooded at some times and dry at others.
d. competition from the railroads.
Question 2John Maynard Keynes attributed the stickiness of real wages in the early years of the depression to ______.
a. the fall in the money supply.
b. the tendency of people to cut wages slowly while looking for a job.
c. the tendency of employers to ruthlessly replace long-time employees with theunemployed.
d. resistance by workers, especially unionized workers, to wage cuts.
Question 3The majority of funding for 19th century American canal building came from
a. the federal government.
b. state governments.
c. local governments.
d. private investors.
Question 4According to Walton and Rockoff, the recession of 1937 and 1938 could be attributed to ______ and ______.
a. the decline in world trade fostered by German and Japanese policies of self sufficiency, open market gold sales by the Federal Reserve
b. increases in taxes, open market gold sales by the Federal Reserve
c. increases in taxes, increases in bank required reserve ratios
d. the decline in world trade fostered by German and Japanese policies of self sufficiency, increases in bank required reserve ratios
Question 5The _____________ received funding from the federal government and two states.
a. Chesapeake and Ohio Canal
b. Erie Canal
c. Pennsylvania Mainline Canal
d. Cumberland and Oxford Canal
Question 6What best describes state fiscal experience in the late 1920s and early 1930s?
a. Revenues dropped consistently through the period because less was being produced.
b. State spending decreased through the period
c. The growth in state expenditures exceeded the growth of federal expenditures during the same period.
d. States either ran budget surpluses or fairly small deficits.
Question 7Compared to the Erie Canal, the primary disadvantage of Pennsylvania canals was
a. state government resistance to providing funds for canal building.
b. the steep, mountainous terrain of Pennsylvania.
c. a pre-existing network of railroads in Pennsylvania.
d. lack of adequate rainfall in Pennsylvania.
Question 8What best describes US federal fiscal experience in the late 1920s and early 1930s?
a. Revenues collected increased rapidly through the period.
b. A balanced budget was maintained for most of the Depression.
c. Tax rates were consistently lowered to spur economic growth.
d. Expenditures grew by over 300 from 1927 to 1940.
Question 9Inland passage times were reduced primarily through
a. increasing the speeds of the boats themselves.
b. shorter layover times.
c. the government activity to clear the rivers of natural obstructions.
d. learning to operate the boats at night.
Question 10Some have argued that the Federal Reserve looked at the wrong indicator of monetary policy, and that the Fed mistakenly thought that monetary policy was easy because ______.
a. the stock of money had grown rapidly
b. the monetary base had grown rapidly
c. market interest rates were low
d. bank reserve ratios were low
Question 11DeWitt Clinton is most recognized for
a. inventing the wheat combine.
b. being one of the primary advocates of the abolition movement.
c. developing the technology to power railroad engines.
d. overseeing the building of the Erie Canal.
Question 12During the Great Depression, one reason the Federal Reserve did not respond forcefully was the free gold problem, which refers to the idea that ___.
a. gold was fleeing Nazi Germany, thus undermining the Fed's attempt to control the money supply
b. gold was essentially free because people had excess supplies of currency that could be converted into gold
c. the Fed claimed that almost all its gold was tied up by reserve requirements (there was little free so it could not increase the money supply)
d. gold was essentially free because silver, which existed in abundance, could be converted into gold at the fixed rate of 16:1
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