The Economic Boom

Question 1

What year did America join WW1?

Answer 1

1917

Question 2

How many Americans died fighting in WW1?

Answer 2

100,000

Question 3

What was the economic outcome of WW1?

Answer 3

1. The US came out debt-free, and was owed money by countries like the UK and Germany
2. By 1920, the US was one of the world’s leading producers of raw materials like coal, iron, cotton…

Question 4

In 1916, how many American homes (%) had electricity?

Answer 4

15%

Question 5

In 1927, how many American homes (%) had electricity?

Answer 5

70%

Question 6

In 1919, how many cars were in the US?

Answer 6

9 million

Question 7

In 1929, how many cars were in the US?

Answer 7

26 million

Question 8

In 1919, how many radios were in the US?

Answer 8

60,000

Question 9

In 1929, how many radios were in the US?

Answer 9

10 million

Question 10

The production of whay type of goods mainly led to the Boom?

Answer 10

Consumer goods

Question 11

How did mass production lead to the Boom?

Answer 11

Goods could be made a lot cheaper and easier, so more goods were available and affordable

Question 12

What were hire purchase schemes?

Answer 12

Consumers could buy goods on credit and pay off the debt in installments, so goods were more affordable

Question 13

What persuaded people to make more goods?

Answer 13

Consumerism (e.g: advertising)

Question 14

How did employment help the Boom?

Answer 14

More people were employed to make the goods, so had higher wages -> more money to spend

Question 15

What enabled people who lived out of towns to buy more goods?

Answer 15

Catalogues

Question 16

When was the Ford Motor Company set up?

Answer 16

1903

Question 17

What was the assembly line?

Answer 17

Cars/parts were transported along a conveyor belt whilst workers stood in the same place worked on them. This led to more mass production.

Question 18

What was the price of a Model T in 1911 vs 1928?

Answer 18

1911: $800
1928: $295

Question 19

How many Model Ts had been sold by 1929?

Answer 19

15 milion

Question 20

How many cars were Fords by the late 1920s?

Answer 20

1 in every 2 cars

Question 21

How many people worked in car manufacturing by 1925?

Answer 21

500,000

Question 22

For every person working in a motor company, how many others were employed in industries supplying materials?

Answer 22

10

Question 23

How did the growth in the motor industry impact other industries?

Answer 23

1. Created jobs in infrastructure/construction (e.g: building more roads), as well as in garages, petrol, etc.
2. Other companies had a higher catchment area for employment as people could travel to work if they lived far.
   3. The principles of mass production/the assembly line influenced other industries so many industries were impacted positively

Question 24

What was laissez-faire?

Answer 24

A Republican policy of non-intervention in the lives of individuals and businesses - literally to “let them do” what they wanted

Question 25

What was the Fordney-McCumber Tariff Act?

Answer 25

1922 - taxes and tariffs placed onto goods imported into the US.

Question 26

How did the Fordney-McCumber Tariff support the Boom?

Answer 26

Goods from other countries were more expensive, so more people bought domestic goods. This meant America made its own money and wasn't reliant on other countries for income.

Question 27

By 1927, how many millionaires were in the US?

Answer 27

15,000

Question 28

How many Americans lived on less than $1000 a year?

Answer 28

42%, 6 million

Question 29

Why were there challenges towards the farming industry?

Answer 29

1. Demand in Europe for American-grown crops declined -> reduced market 2. Mechanisation meant that food production outweighed the demand, so many crops were unsold. This meant farmers couldn't repay loans they had taken out to buy the machinery.

Question 30

How many farmers lost their farms by 1924?

Answer 30

600,000

Question 31

How did African-Americans suffer because of the Boom?

Answer 31

Many were farmers (sharecroppers). They moved to cities to find work, but many businesses operated under racist "whites only" policies.

Question 32

What was another group that suffered due to the Boom?

Answer 32

Indigenous Americans. Most native people were in extreme poverty, were poorly educated and had a lower life expectancy than other groups as a result of centuries of discrimination.

Question 33

What was the stock market?

Answer 33

Companies listed on the stock market and people could buy shares of their company.

Question 34

What was a dividend?

Answer 34

Shareholders would receive a percentage of the company's profits each year. If the company was successful, this could be a sort of "get rich quick" scheme.

Question 35

How could the stock market lead to people losing money?

Answer 35

If a company performs badly, the share price would fall and shareholders would lose money. Shareholders also lost money if they sold their shares, or could not sell them at all.

Question 36

In 1920, how many Americans sold shares?

Answer 36

4 million

Question 37

In 1929, how many Americans sold shares?

Answer 37

20 million

Question 38

What fuelled the growth of the stock market?

Answer 38

1. People taking out bank loans. 2. A method of purchasing shares called buying on the margin.

Question 39

What was buying on the margin?

Answer 39

Buying a share of a company with a small deposit (usually 10%). If value increased, you sold them, paid the remaining amount of the purchase price and pocketed the rest. It was a quick way of making money, but only if prices continued to rise.