The Economy of the 1920s

What does it mean to buy on credit?

• You can buy something for a discount

• You get the item for free

• You pay with cash right away

• You pay very little or no money up front, paying off the rest later (installment plan)

What is consumerism?

• A type of religion

• Refusing to buy goods

• The desire to purchase more and more goods

• A type of car

What did it mean to buy a stock on margin?

• People could purchase a stock for a very low down payment, with the promise of paying back the rest later

• You bought it at full price up front

• Buying only one stock at a time

• It meant looking at stocks, but not actually buying

Which of the following contributed to the economic boom of the 1920s?

• an increase in civil rights for women and minorities
• installment buying and buying stock on margin
• the mobilization of the economy for war
• increased government restrictions on big business

Why was buying stock on margin risky?

• It wasn't risky

• It could leave people in a lot of debt

• People couldn't get loans

• The government could take away your loans