Causes of the Great Depression

How did overproduction of U.S. goods by manufacturers contribute to the Great Depression?

• by prompting businesses to build factories in more locations

• by encouraging businesses to employ more workers

• by resulting in large unsold inventories due to market saturation

• by causing an increase in prices of goods in foreign markets

How did participation in World War I affect U.S. agriculture at the end of the war?

• The United States government offered opportunities for returning veterans in the agricultural sector.

• The agricultural sector increased exports in order to raise profits.

• Overproduction of farm goods during the war led to a collapse in agricultural prices

• The United States government created free trade agreements to increase markets for agricultural products.

What was one factor that led to the Great Depression?

• increases in the tax rate for corporations

• excessive speculation in the stock market

• high wages paid by employers

• government limitations on the amount of money in circulation

Which conditions are most characteristic of an economic depression?

• too much money in circulation and high stock prices

• high employment and increased real estate investments

• large business investments and low taxes

• high unemployment and overproduction

How did the American economy of the 1920s differ from the economy of the 1930s?

• The 1920s saw increased consumer borrowing and speculation, while the 1930s saw a rise in unemployment and business failures

• The 1920s saw a decrease in consumer borrowing, while the 1930s witnessed prosperity and success in the U.S. economy

• The 1920s saw a large increase in unemployment, while the 1930s saw a sharp decline in unemployment and homelessness

• The 1920s saw a marked increase in the role of government, while the 1930s saw a reversal of this trend.

Which day is Black Tuesday?

• November 1, 1930

• December 7, 1941

• October 29, 1929

• September 1, 1982

Which factor contributed to the trend shown on this graph?

• low confidence in the stock market

• low demand for stocks

• strict government regulation of the stock market

• buying of stocks on margin

In the fall of 1929, a wave of panic selling gripped the stock market as a result of

• Government limits on speculation

• Business failures

• Corruption among stockbrokers

• A sudden fall in stock prices

Practices such as buying on margin reflected Americans

• Lack of faith in the stock market

• “get-rich-quick” attitude

• Demand for safe, secure investments

• Moral virtue

Which of the following was a major cause of the Great Depression?

• overproduction and underconsumption
• a decrease in the supply of consumer goods
• an increase in demand for imported products
• an increase in the price of wheat on the world market