Economic Boom Flashcards
What policy did America follow during WWI?
Isolationism
How did isolationism benefit America?
American banks loaned money to the allies to buy food, weapons and equipment. This created jobs for Americans and meant that at the end of the war America led the world in production of medicine and basic goods. America was the only major nation without wartime debts.
What does the ‘consumer society’ refer to?
There was a huge demand in America for modern goods which created jobs in factories
How much did the percentage of homes in USA with electricity grow?
15% in 1960 -> 70% in 1927
What did the Fordney-McCumber Tariff do?
Placed high taxes on foreign imports, making them more expensive. This encouraged people to buy US-made goods, creating more jobs
What were taxes like in America?
Taxes were low so people had more money to spend. Taxes paid by companies was cut so more businesses were created, creating more jobs
What was Laissez-Faire?
Businesses were left alone to get on with creating money and taxes were kept low
How did companies adverise their goods?
They used colourful billboards and magazines. Catalogues made buying easy and goods could be delivered to your door.
What did ‘Buy now, Pay later’ allow Americans to do?
Hire purchase plans meant buyers could pay for goods in small installments. 6 out of 10 cars were bought this way
What does ASHAME stand for?
Afford, Spend, Hire Purchase, Advertising, Mass Production, Employement
How did the number of consumer goods increase throughout the 20’s?
Cars: 9 million in 1919 -> 26 million in 1929
Radios: 60K in 1919 -> 10 million in 1929
Telephones: 10 million in 1919 -> 20 million in 1929
Refrigerators: For every fridge in 1921, there was 167 by 1929.
What was the cycle of prosperity?
Mass Production -> People can afford to buy cheaper goods -> More employement to make goods -> People spend wages on goods -> Advertising increases sales -> Hire purchase plans help people buy more goods
What method of production did Henry Ford introduce and what did it allow?
Assembly Line- cars could be made quicker and cheaper
How did the price and production of the Ford Model T change?
$800 in 1911 -> $295 in 1928
15 million people bought Model Ts between 1911 and 1929.
What was life like in the countryside?
After WWI there was less European demand for American imports and some countries even taxed US prodcuts. More food was produced which meant prices fell. Some farmers couldn’t afford to repay loans and faced eviction. 600,000 farmers lost their farms in 1924 alone.
