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World History
Posted 7 months ago
21. Which of these contributed most to the start of the Great Depression
The collapse of the stock market
A decline in automobile prices
Shortages of agricultural goods,
A decrease in consumer spending
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Answer from Sia
Posted 7 months ago
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#(a)# The Great Depression, which began in 1929, was the result of a combination of factors that affected the global economy. However, the most immediate trigger was the collapse of the stock market. On October 29, 1929, known as Black Tuesday, stock prices plummeted, and the market lost a significant portion of its value. This event did not happen in isolation; it was preceded by a period of speculative bubble in stock prices and excessive investment using borrowed money, known as buying on margin.
#(b)# While a decline in automobile prices, shortages of agricultural goods, and a decrease in consumer spending were all factors that contributed to the economic downturn, they were more symptomatic of underlying economic weaknesses rather than direct causes. The agricultural sector had been suffering throughout the 1920s due to overproduction and falling prices, which led to less income for farmers and rural communities. Decreased consumer spending was a result of the initial financial shock and loss of confidence following the stock market crash, which then led to a downward economic spiral.
Answer
The collapse of the stock market contributed most to the start of the Great Depression.
Key Concept
The stock market crash of 1929 was the most immediate trigger of the Great Depression.
Explanation
While other factors played a role in the economic downturn, the sudden and dramatic loss of stock market value precipitated the broader economic collapse that characterized the Great Depression.
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