How did the great depression begin?
Investors began to worry the boom would end and began selling stocks
Investors paid back their loans too late to help the economy
People were not willing to sell their stock
Farmers had to sell stock to pay for farm equipment
1.A
In part, yes, A. There's a lot more to it, but that's the best choice out of these simplistic answers.
1:A
2:C
3:D
This is for connexus 8th grade
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The Great Depression, one of the most severe economic downturns in history, began in the late 1920s. It was triggered by a combination of factors, including the stock market crash, the failure of banks, and the decline in overall economic activity.
One of the primary causes of the Great Depression was the stock market crash of 1929. Prior to the crash, there was a period of tremendous economic growth and optimism, known as the Roaring Twenties. Many people were investing heavily in the stock market, hoping to make quick profits.
However, as the 1920s progressed, signs of an economic slowdown began to emerge. Investors started to worry about the sustainability of the boom and the high valuations of stocks. As a result, they began selling their stocks, leading to a massive decline in stock prices. This sudden and dramatic drop in stock prices became known as the stock market crash.
Another contributing factor was the excessive use of credit and large amounts of debt. Many investors had purchased stocks using borrowed money. When the stock market crashed and stock prices plummeted, investors were unable to repay their loans. This caused financial institutions, such as banks, to suffer significant losses.
The failure of banks and the overall decline in economic activity further exacerbated the situation. As banks struggled to collect on loans and faced increasing numbers of depositors withdrawing their funds, they were forced to reduce lending. This decrease in lending made it more difficult for businesses and individuals to obtain credit, stifling economic growth.
Additionally, the agricultural sector also faced challenges during this period. Farmers were already struggling due to falling crop prices, overproduction, and mounting debt. To make matters worse, during the Great Depression, farmers had to sell their stocks to pay off debts or cover their operating costs. This increased selling of stocks further drove down stock prices and contributed to the overall economic decline.
In summary, the Great Depression began with a combination of factors such as the stock market crash, excessive use of credit, bank failures, and economic challenges faced by the agricultural sector. These factors led to a severe decline in economic activity, high unemployment rates, and widespread financial hardship, marking the beginning of the Great Depression.