Consider the period between 1929 and the depth of the Great Depression in 1933.In terms of aggregate demand and aggregate supply, which of the following best describes what happened in Canada during this period?
A) The aggregate supply curve shifted inward with no change in the aggregate demand curve.
B) The aggregate demand curve shifted inward with no change in the aggregate supply curve.
C) The aggregate demand curve shifted outward with no change in the aggregate supply curve.
D) The aggregate supply curve shifted outward with no change in the aggregate demand curve.

Question

Consider the period between 1929 and the depth of the Great Depression in 1933.In terms of aggregate demand and aggregate supply, which of the following best describes what happened in Canada during this period?  
A) The aggregate supply curve shifted inward with no change in the aggregate demand curve. 
B) The aggregate demand curve shifted inward with no change in the aggregate supply curve. 
C) The aggregate demand curve shifted outward with no change in the aggregate supply curve. 
D) The aggregate supply curve shifted outward with no change in the aggregate demand curve.

Quizplus · Accepted Answer

During the period between 1929 and the depth of the Great Depression in 1933, there was a decrease in consumer spending, investment, and international trade. This caused a decrease in aggregate demand, which shifted inward. However, there was no significant change in the aggregate supply curve during this time. Therefore, option B is the correct answer.

Consider the Period Between 1929 and the Depth of the Great