Question

After the Stock Market Crash in October 1929, there was A An increase in loans for building and factories B A decrease in business failures C An increase in industrial production D A decrease in demand for consumer goods

Answer 1

The correct answer is D A decrease in demand for consumer goods.

Indeed, after the crash, thousands of banks went bankrupt with over a billion dollars’ worth of deposits from account holders. Because so many banks failed, they were unable to provide loans for building and factory projects. Business failures increased all over the nation and because millions of people were unemployed and destitute, they had no money to buy any goods and thus the demand of such consumer goods decreased accordingly.