Question

One of the reasons for the Great Depression was

A) retailers and banks advertised and consumers grew to rely on installment payments and easy credit
B) people simply grew tired of purchasing
C) World War II
D) all of the above

Answer 1

The Great Depression was partly caused by reliance on installment payments and easy credit, leading to defaults and exacerbating economic troubles after the stock market crash.

Step-by-step explanation:

One of the reasons for the Great Depression was A) retailers and banks advertised and consumers grew to rely on installment payments and easy credit. The widespread availability of credit allowed consumers to purchase items they could not afford upfront, eventually leading to massive defaults that starved retailers and forced them to lay off workers. Additionally, the overproduction of goods coupled with the underconsumption by the American populace, who lacked the purchasing power due to unequal wealth distribution, exacerbated the economic downturn. When the stock market crashed, banks demanded repayment of loans, especially those abroad, causing businesses to shut down and unemployment to soar. Government austerity policies further reduced the available capital, extending the Depression.