Chapter 21 Section 1
1. Herbert Hoover – former ___________________ ___ __________________ and Republican
candidate for President in 1928
2. speculation – when investors __________________that stock prices will rise
3. Black Tuesday – _________________ _____, ____________, the day the stock market crashed
4. business cycle – periodic ________________ and ___________________of the economy
5. Great Depression – The collapse of the _____________ ________________ and ___________
economies beginning in 1929
6. Hawley-Smoot Tariff – ______________ ___________________ _____________passed in June
1930 that contributed to a worldwide depression
7. During the 1920s, many Americans enjoyed what seemed like an endless era of prosperity. But
in 1929, the stock market crashed. Production fell, unemployment rose, and the economy went
into a period of dramatic decline.
8. Years after the ______________ ___________________________ began, periodic contraction
was seen as part of the business cycle.
In the 1928 presidential race, the Republican Party was confident.
9. The ________________________________________s took credit for the strong economy.
10. Their presidential candidate was ____________________ _____________________.
11. He believed in voluntary cooperation between ________________________and ____________.
Despite Hoover’s confidence, some saw signs of weakness in the economy.
12. The agricultural _________________was in trouble. Rural farmers produced huge
_______________ of food that _______________________ prices.
13. Farmers could not afford to buy____________ or repay their ____________.
Easy credit and installment buying lead people to purchase goods they can’t pay for.
14. By 1929, Americans racked up more than ___________________________ in personal debt —
more than double the 1921 level.
Rising wages masked an uneven distribution of wealth.
15. While factory workers’ wages rose ___________ factory output increased by ______________.
Until September 1929, the stock market continued to rise.
16. Many people ________________________money to buy stock, ____________________ prices
would continue to go up.
17. Some economists feared that stocks were ____________ - _______________________.
On October 29th, the stock market went into a free fall as investors tried to sell at any price.
18. ______________million shares were sold
19. Billions of dollars were lost in a few hours on “________________ _________________.”
20. As a result, worker incomes rose _________________________, while rich investor incomes
__________________________________.
21. Many who bought _______________ _____ __________________ were wiped out.
The Great Crash was a hallmark of the nation’s business cycle. The economy periodically grows and
then contracts.
22. In growth periods, workers are ______________, wages ______________, and demand for
products________________________.
23. In contraction periods, workers are ____________ wages _______________, and demand for
products ________________.
24. The stock market ___________________didn’t start the Great Depression by itself. Instead, it
quickened the __________________ of the U.S. economy.
25. The banking system feels the _______________ of the crash first. People fear that their money
will be lost so they run to the bank and attempt to ___________________________ their funds.
26. But banks don’t have enough of their __________________________ on hand as cash. These
bank runs cause banks to________________.
27. Factories _________________, causing worker _______________________.
28. This __________________________ demand for goods.
29. By 1933, the __________________________________rate reached 25%.
Congress passed the _______________-___________________ _________ to protect American
manufacturers from foreign competition.
30. The strategy was a mistake. Other nations _____________________ and raised tariffs as well.
31. The resulting drop in world trade only made the _____________ of American factory and farm
products harder to sell.
As international trade falls, a global drop in business leads to a worldwide depression.
32. The Plummet cycle: U.S. __________________ leads to ________________________________,
which causes the European ________________________________________________________
leads to European____________________________________________, then Europeans cannot
____________________________________________ which causes the U.S. to _____________.
There were several causes of the Great Depression. There is still disagreement over which are most
important.
33. Each of the following contributed to ______________________________ economic conditions:
34. hardships in __________________and rural ________________________
35. uneven ____________________________ of wealth
36. ______________________ in the stock market
37. increased ____________________debt