Macroeconomics 5th Edition by Olivier Blanchard

Exercise 2

Using the information in this chapter, label each of the following statements true, false, or uncertain. Explain briefly.
a. The stock market crashed in 1929 because financial investors realized that the Great Depression was coming.
b. The Fed could have done more to prevent, or at least to limit, the scope of the Great Depression.
c. The decrease in the unemployment rate explains why deflation ended during the Great Depression.
d. The Japanese slump of the 1990s and 2000s was triggered by the sharp fall of Japanese stock prices at the end of the 1980s.
e. The Japanese central bank can help the Japanese economy recover by keeping inflection very low.