Notes (T1) Flashcards
Inflation
The increase in prices of products
Is inflation normal for an economy?
Yes
Trade
The buying and selling of goods between countries
Tariffs
A tax placed on on products being traded
What is the role of tariffs?
To stop cheap imports flooding the country
Interest rate
A % placed on some money
Give an example of when interest rates are used
When you loan money, an interest rate is placed on that
What is GDP?
Gross Domestic Product
What does Domestic mean?
Within the country
What does National mean?
Worldwide
What sort of attitude did the government have during the boom?
Laissez-faire
Unemployment never rose above ___?___% in the years 1922-29
3.7%
During the boom, unemployment never rose above what?
1%
How many hours did workers do on average in 1929?
44
How many hours did workers do on average in 1920?
47
How did the decrease in the average amount of hours for workers affect them?
They had more leisure time - meaning they spent more money, fuelling the boom
How much did the real wages of workers rise by between 1914-1929?
14%
How much did the production of goods rise by during the boom?
50%
In 1929 how much was spent on radios?
$852 million
Boom
Economy is thriving - high employment and lots of money
Bust
Economy fails - High levels of unemployment and little money
Recovery
Recovering from an economic crash/bust
Who didn’t experience prosperity?
Black, Hispanic and Native Americans
What were the reasons for the 1920s boom (8)?
- Laissez-faire gov.
- WW1 made them rich
- Consumer boom
- Advantageous foreign market
- The automobile
- Hire purchase
- Advertising + marketing
- Technological advances
Who were the presidents during the boom?
- Hoover
- Coolidge
- Harding
Why were the presidents during the boom successful?
Their conservative views
What did Andrew Mellon do?
Cut the tax on the rich from 50% to 20%
In what years did Andrew Mellon cut taxes for the rich?
- 1924
- 1926
- 1928
The lack of regulation for businesses allowed what?
Child labour
Give an example of the poor treatment of workers due to the lack of regulation?
Some places:
- 56 hours a week
- On 18 cents an hour
Did anyone ever fight back against the poor working hours during this time?
They would take them to court, however big businesses usually won
Who allowed the poor conditions for workers?
The Federal Trade Coorperation
What would happen within businesses to make customers pay more?
Price fixing
Give an example of a huge corporation in this time
J.P. Morgan
- 67% of steel production
- First $billion company
The growth of huge corporations allowed what?
Cartels and holding companies
How many companies did Insull own - what problems did this cause?
111 companies
He couldn’t keep track
When was the Fordney McCumber tariff?
1922
What was the Fordney Mccumber tariff?
- Protecting American trade/product
- Raised import tariffs to 50%
Where did Firestone Rubber company use rubber from?
Liberia
What did cheaper parts such as rubber in foreign countries lead to?
Many companies moved to poorer countries
What was a positive of companies moving to poorer countries?
Some companies supported local areas
