The Great Depression

The Great Depression:

Causes and Impact​

By Minakshi Khemka

What caused the Great Depression?

​Overproduction and Speculation

​The Great Depression was a global phenomenon. It was traumatic partly because it came so suddenly after a period of unprecedented prosperity and a mood of optimism and confidence particularly the USA.

​

It caused ​a severe decline in employment, production, income and trade.

​1914

First World War​ begins

​1918

The First World War ends​

​1929

The beginning of the Great Depression

​Mid 1930s

The Great Depression comes to an end

​Economic Boom in the USA

• Mass production​

• Assembly line production

• copied by other factories producing consumer goods

• Cheaper products​

• Better wages and improved purchasing power

• ​Increased demand for consumer goods on buy now pay later schemes

• Increased demand for homes and home loans​

​What was this economic boom?​

Multiple Select

Identify the various features of the economic boom in the USA after the First World War

• mass production of consumer goods

• higher wages and increased purchasing power

• Easy Home loans provided by banks

• Increased imports and decreased exports

• Taxes were reduced

Multiple Select

The car manufacturing industry helped people to acquire and create more jobs as

• People could travel far to get to work

• it helped to increase employment through road making and constructing gas stations

• Henry Ford increased wages to employ people in order to produce more cars

• The Ford Model was copied, creating more factories and more jobs

Multiple Select

Europe did not experience an economic boom immediately after the First World War because

• Europe had incurred a lot of debt during the war and had to return the money

• Europe depended on USA for loans to recover

• Germany faced a hyperinflation and its currency was greatly devalued

• Unemployment was rampant, creating a feeling of anxiety and uncertainty

Multiple Select

Identify some reasons behind the downfall of the US economy

• overproduction of consumer goods and a gradual decrease in their demands

• Purchase of goods and homes on a credit system and loans

• Overproduction of agricultural goods creating a glut

• Intense speculation in purchase and sale of stocks.

Multiple Select

The Depression affected the people in different ways

• factories shut down and they lost their jobs

• With almost no cash in hand they could not repay loans

• houses were mortgaged or sold

• Farmers could not harvest their crops and allowed them to rot

Multiple Choice

The Great Depression meant

• decreased circulation of cash

• Increased stockpiling of goods and grain

• Large scale employment

• fall in prices.