THE GREAT DEPRESSION 1929 1940
PRESIDENT HERBERT HOOVER AND THE GREAT DEPRESSION
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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to begin borrowing money to spend in a deficit
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to lend money to companies to stimulate hiring
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to increase the amount of currency in circulation
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to extend credit to people in order to secure their homes
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Detailed explanation-1: -Traditionally, rural demand has been a key driver of currency in circulation. But this time around real rural wages are falling. But inflation raises the demand for cash in hand to meet regular expenses.
Detailed explanation-2: -When a central bank is looking to increase the quantity of money in circulation, it purchases government securities from commercial banks and institutions. This frees up bank assets: They now have more cash to loan.
Detailed explanation-3: -The currency in circulation in a country is based on the need or demand for cash in the community.
Detailed explanation-4: -Currency in circulation is the amount of money that has been issued by monetary authorities minus currency that has been removed from an economy. Currency in circulation is an important component of a country’s money supply.