Question

QUESTION 12 In the United States between 1929 and 1933 the reserve/deposit ratio increased currency/deposit ratio increased both a and b none of the above QUESTION 13 If GNP (Y) is less than national expenditure, then the current account is positive True False QUESTION 14 As a result of adopting protectionist trade policies and generally neglecting exports, LA countries in the 1960-80 period experienced low rates of growth of GDP per capita. True False QUESTION 15 Canada, Australia, and New Zealand remained on the gold standard until the United States went off gold in 1934 True False

Answer 1

Answer: Option C i.e. both A and B are correct

EXPLAINATION: Period given in the question is 1929 to 1933 which is well known period of great depression that affected all the economies of that time.Due to its effect reserve to deposite ratio and currency to deposite ration both were increased as as a result money supply decreased in the 1929 t0 1933.

Answer 2: Statement will be False

EXPLAINATION: in Balance of payment concept we have learnt about Current account which is equal to:

CA= Savings-Investment

GNP is monetary value of all the good and services produced by country's nationals(citizens) i.e. net income from abroad will also be included in it, It'll be Saving and as given in question itself-

Saving is less than expenditure or investment hence Current Account will be negative.

Answer 3: Statement will be True although to some extent other factors also responsible for low growth of GDP per capita.

EXPLAINATION: Apart from protectionist trade policies and neglecting exports other factors responsible were most of the countries were dominated by autocratic rulers in place of democracies so ideological rivalries played part in trade or economic front also.Another reason was booming of various Asian economies like HongKong,China to some extent, South east asian economies etc.

Answer 4: statement is false.

Example:In 1931 i.e. on the onset of Great depression Britain left the gold standard and along with it Australia and new New Zealand also left it as they were losing much gold after that Canada followed them too.

Hence they all left in 1931 whereas US left it in 1934.