Causes & Effects of the Great Depression (Greenway)

Which of the following trends during the 1920s set the stage for the Great Depression?

• Americans building up personal debt

• Banks making lots of very safe loans

• Americans refusing to play the stock market

• A lack of developed farmland in the Midwest and Great Plains

What can you infer about the federal government's economic policies during the Roaring Twenties?

• It regulated the stock market tightly

• It encouraged saving

• It encouraged the fair distribution of wealth

• It encouraged spending

Why did so many banks fail during the Great Depression?

• Back then, banks had no deposits—they only made loans

• The banks had invested all their depositors' money in the stock market

• The banks had used their depositors' money to buy automobiles, radios, and other popular inventions

• The banks had made risky loans that weren't paid back

During the Stock Market crasch of 1929,

• investors quickly bought more stocks to ensure a profit.

• stock prices fell, causing billions of dollars to be lost.

• stores hired more employees to capitalize on consumer demand.

• banks loaned money to homeowners to cover their mortgages.

Who was president when the stock market crashed?

• Theodore Roosevelt

• Woodrow Wilson

• Herbert Hoover

• Franklin Delano Roosevelt

What was one of the biggest reasons why the American economy boomed in the 1920s?

• mass production led to goods being made faster and an increase in supply

• the arrest of criminals who wouldn't stop killing people

• the banning of alcohol

• giving women the right to vote

People who could no longer afford their homes were forced to live in cardboard shacks that they built in public parks. What were these shacks called?

• Shantyshacks
• Town Homes
• Tenement Housing
• Hoovervilles

After the Stock Market Crash, many people lost their life savings because _______________.

• banks closed
• banks gave away their money
• they couldn't remember where they put it
• someone stole it

What caused many farmers to foreclose on their farms in the 1930s?

• Growing too few crops

• Overproduction of crops and costs of machines

• Expensive land and not enough workers

• The Wall Street Crash

Overproduction and underconsumption factored into causing the Great Depression by

• causing falling prices on goods.

• forcing a decrease in mechanization.

• leading to more spending than saving.

• scaring farmers into growing fewer crops.