Deck 21: Mobilizing for War

Question 1

What most accurately describes what happened to earnings in the US between 1914 and 1920?

A)Both nominal and real earnings increased substantially.
B)Nominal and real earnings dropped significantly as the World War I triggered a recession.
C)Nominal earnings increased slightly,but real wages decreased because of the large inflation.
D)A period of deflation led real earnings to increase even though nominal earnings had decreased slightly.

Answer 1

Both nominal and real earnings increased substantially.

Question 2

At the end of World War I,the ___________ outlined in broad terms the territorial adjustments that should occur in Europe,the extent of the reparations the losing nations owed,and the general association of nations that would guarantee each nation's sovereignty in the future.

A)Treaty of Versailles.
B)The Fourteen Points.
C)The Economic Consequences of Peace.
D)The United Nations.

Answer 2

The Fourteen Points.

Question 3

Between 1914 and 1920,the US price level ______________.

A)fell dramatically.
B)nearly doubled.
C)rose and fell in accordance with intensity of the war.
D)remained relatively stable.

Answer 3

nearly doubled.

Question 4

The U.S.financed WWI primarily by:

A)increasing personal income taxes.
B)increasing corporate taxes and luxury taxes.
C)borrowing from the public.
D)printing new money.

Question 5

What best describes the role of the United States in World War I?

A)The U.S.entered World War I as soon as it started.
B)The U.S.was a neutral moderator throughout the war.
C)The U.S.entered the war on the side of Russia and opposed Austria Hungary.
D)U.S.business suffered severe financial losses during the war.

Question 6

One of the causes of World War I was _________.

A)the deteriorating standards of living in Europe.
B)the assassination in Serbia of Austrian Archduke Ferdinand.
C)Europe had experienced several wars in recent decades that spilled over into World War I.
D)the European working class was increasingly fractured and nationalistic.

Question 7

The best description of the economic ideology during World War I was __________.

A)The belief that the economy could be strengthened by centralized coordination.
B)The economy would work best with a strong commitment to the free market.
C)The US should eliminate many federal agencies during World War I to make the government more efficient.

Question 8

All of the following are associated with the War Industries Board except

A)the negotiation of the prices of key industrial products.
B)developing and implementing the bulkline pricing system to determine industrial prices that maximized output.
C)the unintended consequence of the "priorities inflation" of contracts.
D)establishing and enforcing minimum wages for manufacturing workers.

Question 9

Which of the following was not a reason why wages in the US increased during World War I?

A)A sharp decrease in immigration during the war.
B)A large increase in drafting men into the armed forces.
C)A large increase in the number of government contracts.
D)A large increase in the number of women who were employed in the labor market.

Question 10

The War Industries Board,headed by Bernard Baruch,performed all of the following functions except

A)negotiating prices of key industrial products.
B)developing and implementing the bulkline pricing system to determine industrial prices that maximized output.
C)establishing a ratings system for government contracts.
D)establishing and enforcing minimum wages for manufacturing workers.

Question 11

What best describes the impact of a price ceiling in a competitive market?

A)This benefits all consumers because they are able to obtain the good for a lower price.
B)The quantity supplied will be in excess of the quantity demanded.
C)It will likely lead to consumers waiting in line for longer periods of time to buy the good.
D)It will benefit both consumers and producers of the good.

Question 12

To pay for WW I,the national debt was expanded from ___ percent of GDP at the beginning of the war to ___ percent of GDP by the end of the war.

A)1;5
B)2;13
C)3;32
D)The national debt did not expand due to reparations payments.

Question 13

Food rationing during World War I under the wartime food administration featured

A)voluntary calls for "Meatless Mondays" and "Wheatless Wednesdays."
B)a broad policy of direct controls on prices set by the Food Administrator.
C)rationing for all food products except sugar.
D)a pervasive belief that fear of government retribution,rather than appeals to moral principles,was key to reducing consumption,and maintaining food surpluses for export.

Question 14

If a government wants to distribute the burden of increased spending onto future generations it should:

A)Increase taxes.
B)Borrow from the public.
C)Print more money.

Question 15

Robert Higgs argued that ________ best explained the growth of "Leviathan" (Big Government).

A)crises that changed fundamental ideologies.
B)urbanization.
C)the decline in organized religion as a provider of aid and relief for the poor.
D)expansion of the right to vote.

Question 16

During the post war period,

A)an economic slowdown occurred immediately following the Armistice.
B)a vigorous boom began in 1919.
C)the Federal Reserve followed a policy of keeping its discount rate below market rates.
D)All of the above are correct.
E) Only b and c are correct.