Question

What factors caused the Great Depression to spread around the world? check all that apply.

Answer 1

Answer:

Americans stopped buying from overseas nations.

Many countries raised tariffs on imported goods.

Americans demanded repayment of European loans.

Explanation:

Answer 2

The Depression spread rapidly around the world because the responses made by governments were flawed. When faced with falling export earnings they overreacted and severely increased tariffs on imports, thus further reducing trade. Moreover, since deflation was the only policy supported by economic theory at the time, the initial response of every government was to cut their spending. As a result consumer demand fell even further. Deflationary policies were critically linked to exchange rates. Under the Gold Standard, which linked currencies to the value of gold, governments were committed to maintaining fixed exchange rates.