Final answer:
In the 1920s, the majority of the nation's wealth was held by a small percentage of wealthy Americans, with the vast majority not benefiting from the decade's economic growth. Wealth was not evenly distributed, leading to rising prices, stagnant wages, unbalanced income, and overreliance on credit. This contributed to the fragile economic foundation that led to the Great Depression.
Step-by-step explanation:
The 1920s, often referred to as the "Roaring Twenties," was a decade that saw significant economic growth in the United States. However, contrary to popular belief, wealth was not equally distributed amongst all people evenly. The economic prosperity of the era was largely superficial and benefited primarily a select few. As production rates soared and consumerism took hold, the worker's wages remained relatively stagnant, causing the gap between the wealthy and the poor to widen considerably.
The notion of widespread prosperity was largely a myth. In truth, the vast majority of the nation's wealth was held by a small percentage of the population, with about one-half to 1 percent of Americans controlling over a third of the wealth. Many Americans, particularly rural Americans and the urban poor, did not share in the decade's financial gains. With few middle-class consumers able to sustain the new economy centered on consumption, and a large number of families with virtually no savings, the U.S. economy's foundation was fragile.
By the end of the decade, this precarious economic structure contributed to the onset of the Great Depression. The unequal distribution of income meant that fewer Americans could partake in economic advances, leading to a slowdown in consumer buying due to rising prices, stagnant wages, unbalanced income, and the limits of buying on credit. The result was an economy primed for collapse, as there were not enough financially able buyers to support the stock market and consumer goods industries.