AP European History Flashcards: Global Economic Crisis

What this deck covers

This deck focuses on Global Economic Crisis, giving you a quick way to review the definitions, rules, and examples that matter most for AP European History.

How to use these flashcards

Work through these flashcards in short sessions. Try to answer each prompt before flipping the card, then revisit any cards you miss until the explanation feels automatic.

Flashcard 1: What economic phenomenon involves a general decline in prices, often leading to reduced consumer spending?

Answer: Deflation. Falling prices reduce business profits and employment.

Flashcard 2: What is the economic term for a rapid decline in economic activity across an economy?

Answer: Recession. Temporary economic contraction lasting several months.

Flashcard 3: Which policy involves government borrowing to fund infrastructure and public works?

Answer: Deficit spending. Government borrows to fund economic stimulus projects.

Flashcard 4: Identify the economic theory that suggests government intervention can stabilize economies.

Answer: Keynesian economics. Government spending can stimulate demand during recessions.

Flashcard 5: Identify the economic condition characterized by rising prices and increased unemployment.

Answer: Stagflation. Economic stagnation combined with rising inflation.

Flashcard 6: What is the term for a country's total economic output adjusted for inflation?

Answer: Real GDP. Measures actual economic growth removing price effects.

Flashcard 7: Identify the economic policy that aims to control the money supply and interest rates.

Answer: Monetary policy. Central bank tools to influence economic activity.

Flashcard 8: What term describes the severe economic downturn of the 1930s?

Answer: The Great Depression. Decade-long economic collapse following 1929 crash.

Flashcard 9: Which policy tool involves government spending and tax adjustments to influence the economy?

Answer: Fiscal policy. Uses taxation and spending to manage economic cycles.

Flashcard 10: Which country experienced hyperinflation during the early 1920s?

Answer: Germany. Weimar Republic printed money to pay war reparations.

Flashcard 11: Identify the plan that aimed to rebuild European economies after World War II.

Answer: The Marshall Plan. US aid program for European economic recovery.

Flashcard 12: Which economic strategy focuses on reducing government intervention in the market?

Answer: Laissez-faire. Free market approach with minimal government interference.

Flashcard 13: Name the 1944 conference that established the Bretton Woods system.

Answer: The Bretton Woods Conference. Created international monetary system and exchange rates.

Flashcard 14: Which economic crisis led to the widespread adoption of welfare systems in Europe?

Answer: The Great Depression. Economic hardship led to social safety net expansion.

Flashcard 15: Identify the 1920s practice of buying stocks with borrowed money.

Answer: Buying on margin. Leveraged speculation increased market volatility risk.

Flashcard 16: What was the main cause of the 1929 stock market crash?

Answer: Speculative bubble. Asset prices exceeded their fundamental economic value.

Flashcard 17: Name the 1930 tariff act that worsened the Great Depression by reducing international trade.

Answer: The Smoot-Hawley Tariff Act. Protectionist tariffs reduced global trade volumes.

Flashcard 18: Which British economist advocated for increased government spending during a recession?

Answer: John Maynard Keynes. Developed theory of deficit spending during downturns.

Flashcard 19: Which agreement ended the Bretton Woods system of fixed exchange rates?

Answer: The Smithsonian Agreement. Devalued dollar and introduced floating exchange rates.

Flashcard 20: What is the process by which a country experiences a rapid decrease in the value of its currency?

Answer: Currency devaluation. Currency loses purchasing power relative to other currencies.

Flashcard 21: Identify the economic theory that suggests government intervention can stabilize economies.

Answer: Keynesian economics. Government spending can stimulate demand during recessions.

Flashcard 22: Which global crisis in 2008 was triggered by the collapse of housing markets?

Answer: The Global Financial Crisis. Subprime mortgage crisis spread globally.

Flashcard 23: Which international body was established to promote international trade post-World War II?

Answer: The General Agreement on Tariffs and Trade (GATT). Multilateral framework for reducing trade barriers.

Flashcard 24: What economic phenomenon involves a general decline in prices, often leading to reduced consumer spending?

Answer: Deflation. Falling prices reduce business profits and employment.

Flashcard 25: Which international financial institution was created to provide loans to developing countries?

Answer: The World Bank. Provides reconstruction and development financing globally.

Flashcard 26: What is the economic term for a rapid increase in the general price level?

Answer: Inflation. Rising prices reduce purchasing power of money.

Flashcard 27: What is the term for a prolonged period of high unemployment and low economic activity?

Answer: Economic depression. Severe economic contraction lasting multiple years.

Flashcard 28: What was the primary economic policy tool used by governments to combat the crisis?

Answer: Fiscal stimulus. Government spending increases to boost economic activity.

Flashcard 29: Which policy involves reducing interest rates to stimulate economic activity?

Answer: Monetary easing. Lower interest rates encourage borrowing and investment.

Flashcard 30: Which international organization was founded in 1944 to help stabilize global economies?

Answer: International Monetary Fund (IMF). Created to provide financial stability and exchange rate coordination.

Flashcard 31: What event in 1929 marked the beginning of the Global Economic Crisis?

Answer: The Wall Street Crash. Stock market collapse triggered worldwide economic downturn.