Reasons for the boom 1920-1929 (T1)

Question 1

How did industrial production modernise to enable increased production?

Answer 1

• New technologies

- Production line

Question 2

How much did the average wage rise to during the 1920s?

Answer 2

To $1760 per year

up 14%

Question 3

Where in America did not have universal use of electricity?

Answer 3

The southern states

Question 4

Name two reasons for the consumer boom.

Answer 4

People working less hours a week = more free time to buy items
People were on higher wages and could purchase things on hire purchase

Question 5

How many cars were on the road by the end of the 1920s?

Answer 5

27 million

Question 6

What % of the workforce were employed in the automobile industry?

Answer 6

7%

Question 7

What other industries benefited from the automobile industry?

Answer 7

Glass, rubber, steel, road building

Question 8

How did the government make car travel easier?

Answer 8

Federal highways act 1921

Question 9

By 1929, what % of cars were bought on hire purchase?

Answer 9

75%

Question 10

What was management science and how did it change business?

Answer 10

Delegating roles and creating a board of leaders

It meant that the owner of the company didn’t have to do every role (e.g. finance, marketing etc) the roles were delegated to individual employees allowing businesses to grow bigger

Question 11

What happened if you failed on a monthly hire purchase payment?

Answer 11

The product bought on hire purchase would be repossessed

Question 12

How did Americans enjoy better standards of living during the boom?

Answer 12

Hire purchase
Higher wages
Less hours
Cars for holiday

Question 13

What were huge corporations?

Answer 13

Businesses that own a higher % of the market

Question 14

Who were the presidents during the 1920s?

Answer 14

Harding 1921-1923
Coolidge 1923-1929
Hoover 1929-1933

Question 15

Who was the secretary to the treasury?

Answer 15

Andrew Mellon 1921-1932

Question 16

Economic boom

Answer 16

The time where the economy of a country is growing and making more money.

Question 17

What were unemployment rates like at the time?

Answer 17

Never rose above 3.7%

Question 18

What happened to the wages of industrial workers?

Answer 18

Raised by 14% between 1914-1929

Were in average 2 or 3 times higher than wages in Europe

Question 19

What happened the the production of industrial goods?

Answer 19

They rose by 50% between 1922-1929

Question 20

What two developments in the early 20th century helped mass production?

Answer 20

Wider scale introduction of electricity

The assembly line

Question 21

What products began to be mass produced for the first time?

Answer 21

Clothing after sizes were standardised

Automobiles - pioneered by Henry ford

Question 22

Compare the number of automobiles on the road in 1920 to 1929.

Answer 22

In 1920 there were 7.5 million

In 1929 there were 27 million, approx 1 for every 5 people

Question 23

What % of workers, and wages, were employed by the motor vehicle industry.

Answer 23

7% of workers

9% of wages

Question 24

By 1924 what % of the vehicle market did Ford control?

Answer 24

50%

Question 25

What other industries benefited from the boom in automobiles?

Answer 25

Road building, rubber, petrol, glass, motels, car salesrooms

Question 26

Why was there an overproduction in labour saving devices?

Answer 26

By the end of the 1920s, everyone that could afford the labour saving devices such as hoovers and washing machines had purchased them. Much of rural America had no electricity and could not afford them.

Question 27

What impact did technological devices have on leisure?

Answer 27

Motor vehicles meant more travel to national parks and short holidays Tourism developed as an industry The radio was a leisure item People had more free time due to labour saving devices Movie theatres and cinemas were built

Question 28

Which political party were the presidents of the 1920s of?

Answer 28

Republicans

Question 29

Who were the presidents?

Answer 29

Harding 1921-1923 Coolidge 1923-1929 Hoover 1929-1933

Question 30

What was the general government policy and what did this mean for the market?

Answer 30

Laissez-faire, this meant very little government involvement in policy. The free markets were allowed to operate with very little restrictions

Question 31

What did the Fordney McCumber act 1922 do? | What did this mean for the market?

Answer 31

It raised the tariffs on imported goods by 50% meaning foreign goods were more expensive to buy the domestic goods. This meant American producers sold more of their goods

Question 32

How did the federal tax cuts impact the population?

Answer 32

The benefited the wealthy who paid less tax. They did not impact the poor who were too poor to pay taxes anyway.

Question 33

What did the reduction in economic regulations mean for business activity?

Answer 33

Companies would work together to fix prices to prevent fair competition. They could easily exploit workers.

Question 34

What three ways could huge corporations dominate industry?

Answer 34

- Cartels formed (companies would work together to fix prices, meaning little competition) - Holding companies were created (a company becomes so big that they own other companies, giving it the power to fix prices and make big profits) - Small businesses struggle to compete

Question 35

How were businesses changed by the growth of management science?

Answer 35

- They became more complex to manage therefore businesses run by one manager/ entrepreneur were old fashioned - More specific management roles were created such as marketing, production, design and accounting

Question 36

How did advertising change during the 1920s

Answer 36

- Some companies employed psychologists to help them reach target markets ie young women - Campaigns began to include slogans, brand names and celebrity endorsements - Consumers began to believe they can't survive without this product - The amount spent on advertising increased 5 times from 1914

Question 37

How did credit work?

Answer 37

Consumers would pay a deposit, and the rest in regular installments

Question 38

Why is credit so unstable?

Answer 38

Many consumers and businesses ended up with debt that they could not pay back

Question 39

What % of cars were bought on credit?

Answer 39

75%

Question 40

What did the government encourage businesses to do when sourcing raw materials?

Answer 40

- Take advantage of the foreign markets | - For example buying oil concessions in countries such as Canada, Iraq and Venezuela