How did the United States and many European countries initially respond to the decrease in tax revenue caused by the Great Depression?

AReducing taxes on goods imported from other countries
BInvesting more government funds into stock markets
CCutting government spending to avoid going into debt
DCreating public works programs to reduce unemployment

Hello there.

How did the United States and many European countries initially respond to the decrease in tax revenue caused by the Great Depression?

Answer: C. Cutting government spending to avoid going into debt

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scouteo scouteo · Answer 2 · 2019-12-02T12:49:00-05:00

The correct answer is C) Cutting government spending to avoid going into debt.

The United States and many European countries initially respond to the decrease in tax revenue caused by the Great Depression in "cutting government spending to avoid going into debt."

As the Great Depression hit hard on most people, they could not pay taxes because they were left with no jobs. So in order to not generate more debt, the US and other European governments reduce their spending. Let's remember that the Great Depression started on October 29, 1929, after the US stock market crashed, leaving millions of people without a job, many bankruptcies, and hundreds of companies had to close.