Economic Boom 1920s Flashcards
What was the Economic Boom?
-Unemployment never rose above 3.7%
-Inflation never rose above 1%
-Employees worked less hours for more money
-Production of goods increased
-Advertising became more sophisticated
-Economy increased, allowing more economic growth in America
What was the Fordney McCumber Tariff?
Passed in 1922, Fordney McCumber tariff raised taxes on imported goods to cover the difference between domestic and foreign production costs, average of 14%
How did it contribute towards the economic boom?
It made goods cheaper for consumers, therefore buying more it creates a cycle of prosperity because more people buy, more demand and more jobs boosting economy
What were the limitations of the tariff?
Many industrial criticised the tariff it was to expand foreign sales. Increasing the tariff led to limited US exports and constricted the market. These factors helped to create the weakness that produced the depression.
It did nothing to deal with the problem of agricultural overproduction because farmers depended on foreign markets to sell their surplus.
Other countries introduced tariffs
Who benefitted from tax reductions and why?
Wealthy industrialists and business owners profited/benefitted, large scale industries and corporations also profited. Republican perspective on how to govern: Laissez Faire
How did less government involvement contribute to the boom?
Less government involvement meant that no one was enforcing regulations, and personnel to enforce them, companies got away with price fixing.
Business made more profit
Automoblie key knowledge
-Cars were desirable items and more people owned cars than bathtubs
-Created more jobs for building highways, motels, leisure industries
-Created the ability to go new places
-employed 37,500 workers
-1920 -> 8 million dollars
-1929 -> 26 million dollars
Ford produced 1.25 million cars / 7500 daily
How did the automobile lead to an economic boom?
-Most people bought luxury items, car production industries provided jobs for American workers
-Everyone bought Ford Model T
-Federal highways act introduced
-Travelling too new places boosted the economy
-Demand for petrol and motels
Electrical Devices key knowledge
-Vacuum cleaners, radio and washing machines became cheaper to produce
-Introduction of in-store credit and instalment plans which increased in popularity
-Rural Americans still without electricity
How did electrical devices add to the economic boom?
-More people played for electricity, and bought electrical devices because people could now afford them increasing the boom
-Women gained free time due to labour machines like vacuums
Mass production key knowledge
-Closely related to Henry Ford
-Introduction of the Production line and conveyor belts were important advancements
-Price of cars dropped $950 to $290
-1913 took 12.5 hrs to make a car
-1923 it took 2 hrs 40 mins
- Ford Model T every 10 seconds
How did Mass Production lead to an economic boom?
-More items being made in large quantities meant they could be sold at affordable prices
-Provided work for the unskilled
Advertising and Sales key knowledge
-Posters, billboards and coloured newspaper ads
-Targeted advertisements at different people
-Increase in consumer spending
-$3 million spent on advertising
How did ads and sales help the economic boom?
-More criminals saw products to buy
-Indoctrinating people to spend more money
Scientific management key knowledge
the application of scientific principles to increase efficiency in the workplaces
