He Smoot-Hawley Tariff
US Dept. of State The Smoot- Hawley was more a consequence of the Great Depression than an initial cause. But while the tariff might not have caused the Depression, it certainly did not make it any better. It provoked a storm of foreign responses and came to stand as a symbol of the "beggar-thy-neighbor" policies (policies designed to improve one's own lot at the expense of that of others) of the 1930s. Such policies contributed to a drastic decline in international trade. For example, U.S. imports from Europe declined from a 1929 high of $1,334 million to just $390 million in 1932, while U.S. exports to Europe fell from $2,341 million in 1929 to $784 million in 1932. Overall, world trade declined by some 66% between 1929 and 1934. More generally, Smoot-Hawley did nothing to foster trust and cooperation among nations during a perilous era in international relations
Use the preceding reading selection to answer the following question.
Which statement best describes US trade after the Smoot-Hawley act?
Question 5 options:
U.S. imports increased but exports declined, creating an unfavorable trade balance.
U.S. exports increased but imports declined, creating a favorable trade balance.
U.S. imports and exports declined, creating less world trade.
U.S. imports and exports increased, creating more world trade.