Great depression was the severest downturn of the economy .It lasted for more than 10 years .There was fall in the economy as a whole.There was fall in industrial production,prices,unemployment ,rise in poverty and fall in the performance of banks.
<u>Explanation:</u>
Causes of Great Depression:
<u>Stock market crash of 1929</u>:it was one of the major causes that lead to great depression
<u>Bank failures</u>:9000 banks failed and people lost their savings
<u>Reduction in purchasing</u>:With the crash in the stock market people got scared and their purchasing power reduced a lot.
<u>Reduction in production</u> :Less purchasing power of people had a great impact on production.
<u>American economic policies</u> with Europe:In order to protect American companies ,new policies were introduced a high tax was charged on imports which reduces trade with other countries.
<u>Drought</u>:In 1930 drought occurred in Mississippi.Due to which people were not able to pay the taxes and they had to sell their farms.