Practice Quiz

CLEP US History I

Category - Economy

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The Second Bank of the United States became obsolete for which of the following reasons?
  1. The president, Nicholas Biddle, resigned.
  2. The bank's charter was revoked.
  3. Government deposits ceased and the bank could not regulate the states.
  4. Jackson forbade it to conduct business.
  5. The political debate caused people to withdraw funds.
Explanation
Answer: C - When the Second Bank of the United States lost the government deposits in 1833, it lost much of its economic clout. As a result, it was no longer able to dictate policy to states banks, which were becoming increasingly autonomous. Much of its power had come from the financial power of these government deposits, so without them, it quickly dwindled as state banks became stronger.
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