Final Review Flashcards

Question

How did slavery influence American economic development?

Answer 1

Slavery contributed greatly to American wealth, income and economic well-being. It led to the development 2 largely distinct commercial regions. The south had more fertile land and a better climate for growing crops that required slave labor (tobacco, cotton). This forced the north to industrialize. The elimination of slavery further separated the US into a rich north and a poor south. The slave trade began in the U.S. in 1607, and was eliminated by 1808, when the international slave trade was officially banned. By this time, ~660,000 slaves had been imported.

Answer 2

There actually was slavery in the north. Slavery spread throughout the colonies after the first slaves arrived. But the big difference between the north and the south was that between 1777 and 1804, all the northern states individually implemented laws to end slavery.

Answer 3

1. The soil was not fertile at all (except for along rivers). It was horrible for growing crops. For this reason, New England was forced to industrialize.

Answer 4

2. In New England, women and children were highly unproductive in agriculture. When a large labor force isn’t productive agriculturally, there is a low wage labor force for factories.

Answer 5

Draw two graphs. The first one should be "Mfg in NE." Have MPL on the y-axis. Have Amount of Labor on the x-axis. Have a line, MPL of agr, steeper than MPL mfg. Have -- intersecting only the MPL mfg -- a total labor force in NE. The second should be "Mfg vs Agr in Ohio," and should have a less-steep line for agriculture.

Answer 6

Cloth that is lightweight, washable, and colorfast.

Answer 7

The first textile mills were in New England. If either supply or demand shifts to the right, production of cotton textiles would increase. This is because factories were made, so it became easier to make large quantities of cotton cheaply (economies of scale) and because à supply shift out.

Answer 8

huge factories churning out more cloth.

Answer 9

Increased demand due to import substitution, growing population, transportation improvements

Answer 10

1) The industrial revolution causing increased demand for and production of cotton textiles 2) The cotton gin 3) Slave labor, in particular, was used to grow cotton because “cotton was the only form of production lucrative enough to draw slave labor out of sugar cultivation in the Caribbean"

Answer 11

[\*Note, southern soil was actually very conducive to growing cotton] Eli Whitney invented the Cotton Gin in 1793. This invention allowed for faster de-seeding of cotton, which allowed the South to go from producing 100,000 bales of cotton in 1801 to producing 5.4 million bales of cotton in 1859 Slave labor, in particular, was used to grow cotton because “cotton was the only form of production lucrative enough to draw slave labor out of sugar cultivation” High value relative to weight; light, durable, and easy to ship Additionally, slave labor was very valuable and earned an incredibly high rate of return for planters

Answer 12

Advantages of gradual emancipation No or limited taxpayer expenses, Time to adjust, Costs primarily borne by slaves. Northern owners bore little costs. Cost: About $210 million; a loss of female slaves would account for a loss of 3% of slave wealth. Problems: Slaveowners would still have paid a small price under this scheme because of the loss of that portion of female slave value attributable to potential gains from reproduction. Moreover, it consigned all current slaves to life sentences and encouraged owners to works young slaves more intensively since their continuing productivity after emancipation was a matter of no economic interest to the profit-maximizing owner (p. 360)

Answer 13

● Government purchases slaves at market price and frees them ● This would have cost $2.7 billion and would have been messy due to the fact that slaves were different ages, etc. ○ This was about ⅔ of US GDP ● The government didn’t have the money around so it would have had to finance the expenditure with bonds ○ 30 years at 6% \>\>\> would require that 5% of subsequent years’ GDP would be taxes that would be used to pay down the debt

Answer 14

In 1860, a prime male unskilled field slave was $1800

Answer 15

There has been considerable difficulty in adjusting prices across time because the universe of goods and services is different CPI (determined in terms of foregone consumption) then was about $46,000 Wage for unskilled labor was about $.10 per hour (about $7.50 today) Can figure out how many hours unskilled labor would have to work and how much money that would give us 1800/.10 = 18,000 \>\> 180,000 hrs x 7.50 = 135,000 Per capita income then was about $128 and in 2007 was about $46,000 So, cost of a slave today could be anywhere from $46,000 to 600,000 today

Answer 16

Philip Ulrich has said that slavery was not profitable because slave prices rose dramatically between 1845 and 1860 (by about $700) and cotton prices did not rise by nearly as much

Answer 17

However, if slavery was truly unprofitable, we should have seen: Manumission - the voluntary freeing of slaves Discouragement of slave births (which did not happen) Falling prices of slaves

Answer 18

Conrad and Meyer took a different approach, treating a slave as a productive asset and calculating the rate of return using a model similar to the capital asset pricing model (CAPM). They estimated that the rate of return on a slave was about 8% to 10% per year

Answer 19

Slaveholders benefited as the price of slaves rose, which would happen if profits were high and more people entered the market. With supply of slaves fixed, profits that could be extracted by driving slaves hard was already incorporated into the price of slaves They tended to buy slaves later on after demand for them was well known. Slaveholder profit was Ps - Wb - Ws - t (per slave per year) Where: wb is the cost of producing cotton textile ( in England) wa is the cost of growing cotton (labor, transportation and storage) ws is the cost to maintain slaves Ps is the price of slave t is tariffs If Price was equal to MC, slaveholders had a profit of 9 and didn’t truly benefit They had an incentive to get into the market early and maximize the output of their slaves Harsh treatment and punishment

Answer 20

Main points: Every consumer benefited from slavery ∆CS = (w(a)+w(b)–P(slave))(Q\*-Q(slave)0.5). Refer to graph!!

Answer 21

Those in the North and West benefited from lower taxes, since tariffs helped bring in government revenue instead.

Answer 22

o Average birth weight for slave baby = 5.1 lbs. This is very very low and definitely not healthy.

Answer 23

Your average slave child was smaller than the average child living in the slums of Lagos, Nigeria today. Indicated horrible nutrition.

Answer 24

o Slaves received on average 4,185 calories daily o Corn and pork = 2/3 of those calories.

Answer 25

Over 2 years, 45% of slaves were never whipped. Large open wound on your back = high risk for infection – potentially life-ending

Answer 26

- American slaves were treated poorly as young children and babies but given more food when it came to puberty and other times of growth – then they pumped up the protein consumption in order to get a good worker.

Answer 27

Calculating the cost of the Civil War involves the summation of all war-related expenditures and losses, which is termed the “direct” estimate. This statistic includes all Union and Confederate war expenditures, and human and physical capital destroyed in military actions. This is incomplete, however.

Answer 28

TOTAL DIRECT COST TO THE NORTH: $3,365,846,000 (1860 dollars)

Answer 29

TOTAL DIRECT COST TO THE SOUTH: $2,892,709,000 (1860 dollars)

Answer 30

Present value in 1861 of the decrease in consumption, which resulted from the war. Basic assumption is that per capita consumption would have expanded at a constant rate after 1860 such that hypothetical consumption was equal to actual consumption by 1879. $4.515 billion 1860 dollars

Answer 31

8.970 billion 1860 dollars

Answer 32

210 million for gradual emancipation

Answer 33

30% decline in total wealth; 20% in decline in sheep, 36 mules, 32 horses, 35 cattle, 42 wine Real estate dropped 50%; however, physical capital recovered much more quickly than economy (eg roads, horses, fences, etc); therefore, this is not the source

Answer 34

Civil War spurred the development of American Industry: (1) Transfer of power from Southern agrarianists to Northern industrial capitalists (2) War stimulated the economy and increased investment (based on experiences from World War II)

Answer 35

○ Establishment of national banking system, increase in tariffs, land-grant colleges, land grants to Railroads, Homestead Act passes ■ All of these things tended to help farmers as well as industrialists (except the increase in tariffs)

Answer 36

○ Leading industrialist got their start during the Civil War: Andrew Carnegie, Pierpont Morgan. And much more money later ○ HOWEVER, CW stalled economic growth ○ Therefore, war cost about 5 years of commodity growth

Answer 37

Cotton output in the South increased by Brazil, India and Egypt now entering market. Where England got cotton (S percentage) 60: 77, 69: 31, 82 65 There was Increased foreign competition and supply. Exchange rates meant that Southern cotton was more expensive which dropped demand. From a supply side, this is continuation of pre-war trend and rate of change after war did not appear to change as much Demand (before the war world demand increased by 5% yer; 1866-1895: ~1.3/yr Prices also falling overall.

Answer 38

Agriculture after the war implemented via plantation but with no whipping (punishment via wage reductions); Southern whites had land but now no labor; plantations largely failed and divided up into smaller farms that used i. wage labor ii. Sharecropping iii. Tenant farming. Sharecropping: landowners provided seeds, mule, simple farm implement; family would work and keep a share fo the crop ~1/2 – 2/3 Assume that 1 day -\> $5 output (worker kept $2.50); worker would not work if he valued leisure ate $2.51, in this case $5 output lost = incentives not aligned); Wage/ monitoring needed to keep up effort but management cost money Tenancy: incentives aligned with production but tenant di not have inceptive to maintain land or maintain capital improvement Also: former slaves did not want to work under their former masters More efficient: 30 acres and a mule; Freedmen’s Bureau tried to do this; Southern Homestead Act; Sherman’s special order; ultimately failed as former slaves ended up being extremely poor

Answer 39

Small country merchants filled credit vacuum; credit demanded by small farmers; credit given to extremely poor people view crop liens that took crops as collateral; merchant could charge high rates, call for too much cotton and keep them in debt Workers never self-sufficient from a food standpoint. Related to sharecropping. Merchants wanted to exercise their monopoly power and force keep freedmen locked into cultivating cotton.

Answer 40

Labor supply declines following emancipation; number of kids drop; hours down by ½, men by 1/5

Answer 41

The First Bank, the Bank of the United States, was a bank chartered by the United States Congress on February 25, 1791. The Bank was created to handle the financial needs and requirements of the central government of the newly formed United States, which had previously been thirteen individual states with their own banks, currencies, financial institutions, and policies.

Answer 42

Supporters of the bank, including first Secretary of the Treasury Alexander Hamilton, argued that if the nation were to grow and to prosper, it needed a universally accepted standard coinage and this would best be provided by a United States Mint, aided and supported by a national bank and an excise tax.

Answer 43

They believed this centralization of power away from private mints and banks was dangerous to a sound monetary system and was mostly to the benefit of business interests in the commercial north, not southern agricultural interests. They furthermore recognized that the creation of such a bank violated the Constitution, which did not list the creation of a Bank of the United States or of a government mint among the expressed powers allowed to the federal government.

Answer 44

The Second Bank was chartered by many of the same congressmen who in 1811 had refused to renew the charter of the original Bank of the United States. The predominant reason that the Second Bank of the United States was chartered was that in the War of 1812, the U.S. experienced severe inflation and had difficulty in financing military operations. Subsequently, the credit and borrowing status of the United States were at their lowest levels since its founding. The B.U.S. was in no sense a national bank but rather a privately held banking corporation. The bank had a unique relationship with the federal government that gave it access to substantial profits. Its role as the depository of the federal government's revenues made it a political target of banks chartered by the individual states which either objected to, or envied, the B.U.S.'s relationship with the central government. Partisan politics came heavily into play in the debate over the renewal of the charter.

Answer 45

Viewed through the lens of party elite discourse, Schlesinger saw inter-party conflict as a clash between wealthy Whigs and working class Democrats. President Andrew Jackson strongly opposed the renewal of its charter, and built his platform for the election of 1832 around doing away with the Second Bank of the United States. Jackson's political target was Nicholas Biddle, financier, politician, and president of the Bank of the United States. Apart from a general hostility to banking and the belief that specie (gold and/or silver) was the only true money, Jackson's reasons for opposing the renewal of the charter revolved around his belief that bestowing power and responsibility upon a single bank was the cause of inflation and other perceived evils.

Answer 46

o The soundness school focuses on the “soundness” of banks. Andrew Jackson hated the 2nd Bank of the US and as such withdrew all federal deposits from the bank. Furthermore, he issued the Specie Circular, which required that all government land be purchased in specie (silver and gold). Thus, the specie was withdrawn by the Federal Government from the banks and used for land purchases in the West, which led to a depletion of gold and silver reserves in the banks and a resulting run on banks (panic).

Answer 47

o Some that do not buy the arguments of the soundness school focus on the influx of specie during the period leading up to the panic. There was an increase in specie by 116%. The specie came from Mexico, as the US acquired more territory, France, who owed the United States 4 million dollars in specie as reparations, and London, because the US had a higher interest rate and thus investors were putting their gold in the US to earn higher returns. There was also a trade scenario with China that allowed gold to remain in the United States. The panic arose as a result of citizens’ reactions to England’s policies. England raised their interest rates to stop the inflow of gold into the United States, and also passed a law limiting the import of US cotton, which was a major sector of the US economy. With decreased demand for cotton, cotton prices began to fall significantly, which panicked investors.

Answer 48

· Pro metallic standard o Some believed that we should back our money with metal (gold or silver) for two reasons. One reason is that it gives us international credibility, a “good housekeeping seal of approval.” It was thought to demonstrate fiscal responsibility. o Similarly, it would prevent the unfettered printing of money by the federal government, which was leading to large inflation. Throughout the course of the civil war, the price level rose by 76%. Fears of further inflation led many to support returning to a bimetallic or monometallic standard. o Also, because goods were relatively cheaper in England, people could go to Britain and get more for their gold, so gold was leaving the US. o These people were mainly democrats.

Answer 49

o Believed we should just stick with greenbacks. The main opponents of the metallic standard were farmers—because returning to the goal standard would mean deflation and lower prices for their goods—and businessmen because their debts would become relatively more expensive.

Answer 50

She is advised to seek the answer in the Emerald City, which can be found at the end of the yellow brick road. The road, of course, is a symbol of the gold standard. Following it will lead to the Emerald City (Washington, D.C.), but the solution to Dorothy's problems will not be found there. Thus the silver shoes and the yellow brick road are Baum's primary symbols of the two metals.

Answer 51

Dorothy represents America (sweet, innocent) and appropriately comes from impoverished West

Answer 52

Wicked witch of East represents bimetallic standard (dries up to reveal silver). On a general level the Wicked Witch of the East represents eastern business and financial interests, but in personal terms a Populist would have had one figure in mind: Grover Cleveland. It was Cleveland who led the repeal of the Sherman Silver Purchase Act, and it was his progold forces that had been defeated at the 1896 convention, making it possible for America to vote for Bryan and free silver.

Answer 53

the Scarecrow is the western farmer. He thinks that he has no brains because his head is stuffed with straw. But we soon learn that he is shrewd and capable. He brings to life a major theme of the free silver movement: that the people, the farmer in particular, were capable of understanding the complex theories that underlay the choice of a standard

Answer 54

Tin Woodman, Baum's symbol for the workingman. He was once flesh and blood but was cursed by the Wicked Witch of the East. As he worked, his ax would take flight and cut off part of his body. A tinsmith would replace the missing part, and the Tin Woodman could work as well as before. Eventually there was nothing left but tin. This is why the claws of the Cowardly Lion can make no "impression" on him, just as Bryan failed to make an impression on urban industrial workers in the campaign of 1896. But for all his increased power to work, the Tin Woodman was unhappy for he had lost his heart. As Littlefield (1968, p. 375) points out, this tale is a powerful representation of the populist and socialist idea that industrialization had alienated the workingman, turning an independent artisan into a mere cog in a giant machine.

Answer 55

The last character to join the group is the Cowardly Lion. This character is William Jennings Bryan himself.11 The sequence is not accidental. Baum is following history in suggesting that the movement was started first by the western farmers, was joined (to a limited extent) by the workingman, and then, once it was well under way, was joined by Bryan. The roaring lion is a good choice for one of the greatest American orators. why a cowardly lion? In the late 1890s, as I noted, the world gold supply began to increase rapidly, reversing the long deflation. As a result, the usefulness of silver as a political issue declined. It was obvious almost immediately after the election of 1896 that Bryan would again be the standard-bearer in 1900. But with the return of prosperity, he continually received advice to soft-pedal silverver and concentrate on new issues such as opposition to the trusts and anti-imperialism, which would appeal to the eastern wing of the party, advice that to an extent he heeded.

Answer 56

Silver shoes represent silver (especially the silver element in the bimetallic standard and gold-worshipping East

Answer 57

· The question asks for three phases, but in the lecture there were only 2. I think she wants us to include the first phase as the “gentleman’s agreements” that sometimes took place. This was just simply price fixing, but they fell apart because they were not enforceable. Simple prisoner’s dilemma shit. The two real phases were the phases of mergers and integration.

Answer 58

· Phase 2, from 1879-1893, was characterized mainly by horizontal mergers, where two or more companies that did the same thing would combine their operations. Firms had been overexpanding to meet consumer demand, and as a result they combined to try to stay alive. Some of the major players from this period were American Sugar Refining company, US Rubber Company, and Standard Oil.

Answer 59

· Phase 3, from 1889-1904, was mainly characterized by vertical integration, whereby one company would acquire different parts of the production process to reduce middleman fees. The major players here were Andrew Carnegie and JP Morgan and the steel business. The Troesken article talked about the Whiskey Trust. Overall, this industrial concentration led to higher prices and profits because firms became more monopolistic. From basic economics, we learn that firms with market power become price-setters, and this was occurring. For example, American Sugar Refining did 90% of sugar refining in the United States. They could basically pick a price. In phase 2, the prices were not affected so much as the profits. By vertically integrating, they could lower cost of production, so the profit margin grew.

Answer 60

· The time was right for a large wave of mergers in the latter part of the 19th century. From 1898-1904, there were more than 3000 mergers in the United States. The reason for this wave of mergers was fivefold. Technology was one reason. Continuous Flow Production requires no disruption to the supply of inputs, so vertical integration helps minimize costs by having consistent flows of inputs. Secondly, merging allowed producers to achieve monopoly profits (horizontal integration) because they could restrict the quantity produced. The third reason was that there were huge internal markets (Americans) that could now be accessed because of railroads. Fourthly, there was an abundance of natural resources in the United States at the time, which fueled CFP. Lastly, the US had developed the most advanced patent and intellectual property system in the world at the time, which encouraged growth and innovation. Patent system also encouraged innovation.

Answer 61

The rise of big business in America occurred between 1890 and 1940. There was new tech, new energy sources (wind, water, steam (coal), electricity), an increase in human cap and a shift in resources from low to high productivity uses. Continuous flow of production à rise of managers, incentive payment systems, shorter/more efficient production process. Utilized scientific management (e.g. taking lab like management and applying it to business principles.) Industrial revolution à increased standards of living: Overall assessment: Huge advances are made in American living standards. Water, lighting, refrigeration, cooking, heating, washing machines, cars, radio, and vacuums all underwent drastic advances (details below)

Answer 62

Cars Mass market by 1920’s 1921-1929: 27 million sold- There are 19.5 m HH in 1929 1920: 26% people have cars 1930: 60%

Answer 63

1900 Most people didn’t wash their own clothes Commercial laundry/Laundress By 1936, 50% of wired HH have clothing washers By 1950, 75%

Answer 64

1921: 1st broadcast 1925: plug in radio by 1931, ¾ of wired households have radio creates a common culture- same knowledge base

Answer 65

In the 1920s, a typical American household need to save for two to five years in order to purchase a major durable good with cash.

Answer 66

“In the 1920s, the bulk of installment credit extended to households was done so not by sellers nor directly by manufacturers but by sales finance companies, specialized financial institutions that purchase retail time sales contracts from sellers and sometimes also make wholesales inventory loans to them… Their retail financing entails no money lending. In an installment sale, a buyer provides a down payment to the seller and then signs a contract promising to pay the remaining balance (plus charges) in regular, usually monthly, installments. The seller in turn sells this contract to a sales finance company… The other primary means of buying a good on time is a chattel mortgage, the lending of money with an IOU secured by personal property.”

Answer 67

Olney finds that since P of credit decreased, it must be a supply increase, not a demand increase causing the increase in market “Q." The evidence (loosening of credit standards, lower effective interest rates, seems to point to increases in the supply of credit as the dominant force in credit markets in the 1920s.

Answer 68

· Earnings and dividends o Saw substantial growth o Partially driven by D for consumer durables · One view of earnings: Calculating expected future profitability using growth in pre-crash earnings: projecting out into future,we find that very few stocks overvalued · Problem? Use a longer time horizon of past earnings; we find stocks were overvalued o Earnings were just artificially inflated for several years leading up to the crash à prices were supported by the earnings of the period… BUT current earnings were not sustainable. o Bubble started March 1928 · One of the causes: Credit/leverage o Buy stock on margin o Market looked like it would go up, up, up o Inflated stock prices o Investors were buying stock whose value they could not afford to cover if prices fell.

Answer 69

Very severe: between 1929-33: real output fell by 29% and then took 5 years to inch back to pre-depression output rates. If the economy had continued in the 1930’s growth path GNP in 1939 (in 1929 dollars) would have been $40 billion greater. Fall in gross and net investment. Collapse of stock markets, high unemployment (affecting mainly the minorities)

Answer 70

· Unemployment: § Between 1931 and 41, the unemployment rate never fell below 14.3% § 1929: unemployment about 3% § 1930: 9%, 1931: 16%, 1932: 24%, 1933: 25%, 1934-36: 20%

Answer 71

No notes on this to speak of but I’m going to go ahead and assume it fell dramatically.

Answer 72

· 1937-38: the “recession within the depression” § Gross private domestic income goes down 89% § Black unemployment 75% (in cities) § Farmer income decrease 30% § Business failure rate increased 50% § 1/5 of banks failed

Answer 73

-increase in the interest rate and decrease in the money supply lead to decline in business activity in 1920. Add exogenous shocks compounded by bad Fed policy (the Fed failed to act as a lender of Last Resort). There were five shocks; each of which undermined confidence in banking system, therefore decreasing the money supply.

Answer 74

Fed should have increased money supply dramatically and steadily: Should have intensified open market operations by buying government bonds and injecting cash into private deposit banks- bought bonds from people and given people cash back

Answer 75

-Bank reserves increase -Fed raises reserve ratio -Banks increase reserve -Leads to decrease in money supply

Answer 76

The New Deal increased the money supply?

Answer 77

Y=C+I+G: decrease in aggregate demand -unanticipated and unexplained decrease in consumption “underconsumption”, meaning people weren’t spending as much as they should have. This could be traced back to the 1920’s when changes in technology and managerial techniques increased the marginal product of labor. Typically, the more productive workers are, the more they earn but during this period, wages were relatively stagnant. This was a problem because more product is being made but there is not enough money circulating to buy it. “production outstripped buying capacity” -changes in investment as well: disinvestment (i.e. decrease in productive capacity) can explain decrease in GDP -changes in net exports: $1billion 1928 and $33million in 1936 -changes in government: 1930: increase government § $28 b in construction § 1932: G spending largely countercyclical § 1933: shift counter --\> procyclical

Answer 78

-fiscal policy never spent enough: government should have increased in investment or cut taxes to induce greater purchasing power

Answer 79

-Decrease expenditures for relief and public works -New taxes (social security)

Answer 80

-War and the New Deal: Two Phases 1. 33-34: Relief and Recovery 2. 35-41: Move “left” Relief- government as an employer of last resort · Federal Emergency Relief Agency o $.5 billion · Works Progress Administration (1935) · Civilian Conservation Corporation · Public Works Admistration · 1936: 7% of US labor force emergency workers Recovery · National Industrial Recovery Act o Increase price increase wage o Increase employees but decreasing hours · Blue Eagle- something about boycotting those who don’t have Blue Eagle on their door

Answer 81

Temin’s test: Against the monetarist hypothesis: reduction in the supply of money should have caused interest rate to rise but they fell sharply in 1930

Answer 82

Keynes thought is was due to a decrease in investment. However, this began in 1926, not 1929.

Answer 83

i. Substantial, stardardized output ii. Complex operations in 1 building iii. Many workers under a definite organizational structure

Answer 84

b. First factory opened in 1793. ● Slater absconds from English factory to create it in the US.

Answer 85

●1837, CT -- One no longer needs the support of state legislature to form a corporation.

Answer 86

○ One theory for Indian removal was that it was a backroom deal: if the southerners supported this tariff deal, the federal government would kick the Indians out.

Answer 87

○ Women and kids were very unproductive in New England. ○ They get hired by mills and factories.

Answer 88

● Cotton was a revelation: it was lightweight, washable, and colorfast.

Answer 89

b. ∑(Pc + MPs – M)/ (1+r)^t c. Pc – price of cotton d. MPs = Marginal Physical Product of slaves e. M = Maintenance costs f. t = 0 to 30 (life expectancy of slave)

Answer 90

Present value in 1861 of the decrease in consumption, which resulted from the war. Basic assumption is that per capita consumption would have expanded at a constant rate after 1860 such that hypothetical consumption was equal to actual consumption by 1879.

Answer 91

No, war cost about 5 years of commodity growth. Wages fell during the Civil War, Railroad building fell, Decrease in gains from trade

Answer 92

Tenancy: incentives aligned with production but tenant did not have inceptive to maintain land or maintain capital improvement Also: former slaves did not want to work under their former masters

Answer 93

Labor force of black women was 90% in 1860, 40% in 1880

Answer 94

PMINT. 1) patents 2) monopoly π 3) internal markets 4) natural resources 5) tech

Answer 95

The third reason was that there were huge internal markets (Americans) that could now be accessed because of railroads.

Answer 96

merging allowed producers to achieve monopoly profits (horizontal integration) because they could restrict the quantity produced

Answer 97

Continuous Flow Production requires no disruption to the supply of inputs, so vertical integration helps minimize costs by having consistent flows of inputs

Answer 98

70% had running water by 1940

Answer 99

60% had flush toilets by 1940

Answer 100

1940: 79% of households had electrical lighting

Answer 101

By 1940: about 44% had mechanical refrigerators

Answer 102

1940: 44% of HH had central heating.

Answer 103

By 1950, 75%

Answer 104

specialized financial institutions that purchase retail time sales contracts from sellers and sometimes also make wholesales inventory loans to them… Their retail financing entails no money lending. In an installment sale, a buyer provides a down payment to the seller and then signs a contract promising to pay the remaining balance (plus charges) in regular, usually monthly, installments. The seller in turn sells this contract to a sales finance company

Answer 105

Very severe: between 1929-33: real output fell by 29% and then took 5 years to inch back to pre-depression output rates. If the economy had continued in the 1930’s growth path GNP in 1939 (in 1929 dollars) would have been $40 billion greater. Fall in gross and net investment. Collapse of stock markets, high unemployment (affecting mainly the minorities)

Answer 106

Sept 5, 1929: Roger Babson warns that a crash is coming

Answer 107

Decrease in construction (~1920), Spring 1929: decrease durable production, Summer 1929: decrease non-durable production

Answer 108

· President Hoover and the Fed concerned that markets overheating o Aug 29: increase the discount rate to 6%

Answer 109

October 1929

Final Review Flashcards

(138 cards)