Question

What economic choices caused the economy to become unstable in the late 1920s?

Answer 1

Over production of goods caused prices/stocks to fall after ww1 leading up to the great depression.

Answer 2

Answer:

overproduction of goods

Explanation:

The Great Depression of the 1930s was the largest recession in history and its causes were overproduction of goods and the expansion of unbridled credit by banks. The American economy was experiencing a period of euphoria during the 1920s. The US had become the world's leading economic powerhouse and was the largest supplier of manufactures to Europe. The factories took credit and greatly increased their production, causing overproduction.

Europe recovered from the war and drastically reduced imports of American manufactured goods.  However, production increased in a way that there was not enough consumer market to dispose of the products. The businessmen lost the conditions to pay their loans to the banks and the financial system collapsed.