During the Great Depression,consumers and producers in Canada dramatically reduced their spending relative to the quantity of goods and services available at the time.Which economic principle does this statement BEST represent?
A) Choices are necessary because resources are scarce.
B) When markets don't achieve efficiency,government intervention can improve society's welfare.
C) Overall spending sometimes gets out of line with the economy's productive capacity.
D) Government policies can change spending.

Question

Quizplus · Accepted Answer

The statement best represents the principle that overall spending sometimes gets out of line with the economy's productive capacity. During the Great Depression, there was a significant reduction in consumer and producer spending relative to the quantity of goods and services available, indicating that overall spending was not aligned with the productive capacity of the economy.

During the Great Depression,consumers and Producers in Canada Dramatically Reduced