Question

Which financial practice most likely contributed to the Great Depression?

A. Banks lent money for goods and invested their profits in
businesses and corporations.
B. Banks lent money for investments and invested in the stock
market using their depositors' money.
C. Banks began paying interest to depositors who committed to
leaving their money with the banks.
D. Banks began using underwriters to help them make decisions
about lending money.

Answer 1

The financial practice that most likely contributed to the Great Depression was banks lending money for investments and investing in the stock market using their depositors' money.

Step-by-step explanation:

The correct financial practice that most likely contributed to the Great Depression was option B: Banks lent money for investments and invested in the stock market using their depositors' money. This practice, known as speculation, led to a stock market bubble and eventually a crash in 1929. Many banks had invested heavily in the stock market, and when the market crashed, they lost a significant amount of money, causing widespread bank failures and contributing to the severity of the economic downturn.

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