Question

What are three reasons for the depression and high unemployment that followed the stock market crash in 1929?

a) Government overspending, high taxes, and excessive regulation.
b) Decline in consumer spending, bank failures, and reduced industrial production.
c) Increased agricultural production, low inflation, and booming stock markets.
d) Lack of innovation, reduced international trade, and the return of soldiers from World War I.

Answer 1

The depression and high unemployment following the 1929 stock market crash were due to a decline in consumer spending, bank failures, and reduced industrial production, leading to the Great Depression.

Step-by-step explanation:

Three reasons for the depression and high unemployment that followed the stock market crash in 1929 are:

1. A decline in consumer spending, which led to businesses lowering production and eventually laying off workers.
2. Bank failures, exacerbated by the crash, resulted in loss of savings for individuals and capital for businesses, worsening the economic downturn.
3. Reduced industrial production, partly due to lower demand and the ongoing agricultural recession, further increased unemployment.

These factors contributed significantly to the severity and length of the Great Depression, affecting many sectors of the economy both domestically and internationally.