GCSE History | The Booming American Economy of the 1920s

History Quiz - USA: 1919-1932 - The US Economy In The 1920s (Questions)

Explore the booming US economy of the 1920s in this GCSE History quiz, from mass production and easy credit to confidence, inequality and warning signs before the Crash.

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Fascinating Fact:

The car industry stimulated other sectors of the economy. It increased demand for steel, glass, rubber, oil, and road building, which created millions of jobs.

In GCSE History, the US economy in the 1920s shows how mass production, hire purchase and rising confidence created an economic boom. You also explore who missed out and why the prosperity was fragile.

Key Terms

Mass production: Making large numbers of identical goods quickly and cheaply on an assembly line, often used in car factories like Ford.
Hire purchase: A system where customers pay a small deposit and then regular instalments so they can buy goods such as cars or radios on credit.
Laissez-faire: An attitude where the government interferes as little as possible in business and the economy, allowing companies to make their own decisions.

Frequently Asked Questions (Click to see answers)

How did the car industry help the US economy in the 1920s?

The car industry boosted the US economy by using mass production, which cut prices and increased sales. It also created extra demand for steel, glass, rubber, oil and new roads, supporting millions of jobs.

Why was there an economic boom in America in the 1920s?

The boom came from mass production, plenty of natural resources, new consumer goods, easy credit and confidence after the First World War. These factors encouraged businesses to invest and people to spend more money.

Who did not benefit from the 1920s economic boom in the USA?

Many farmers, Black Americans, recent immigrants and some industrial workers did not share fully in the boom. Falling crop prices, discrimination and low wages meant some groups stayed poor while others prospered.

Try These Related Quizzes

Which of the following list of US presidents during this period was not a Republican?

[ ]	Harding
[ ]	Woodrow Wilson
[ ]	Hoover
[ ]	Coolidge

During this period United States governments imposed taxes on the import of foreign goods in order to protect the domestic market. What were such duties called?

[ ]	Levies
[ ]	Tariffs
[ ]	Emoluments
[ ]	Fees

Which US businessman of this era was most closely identified with mass production, which led to cheaper goods and - temporarily - to more employment?

[ ]	Rockefeller
[ ]	Carnegie
[ ]	Dow
[ ]	Henry Ford

Which method of purchase became popular in the US before 1929, whereby buyers obtained a loan from the retailer in order to complete the transaction?

[ ]	Mail order
[ ]	Hire purchase
[ ]	Discounted buying
[ ]	Using a credit card

Many people were tempted to buy shares traded on the New York Stock Exchange using the "on the margin system". What did this mean?

[ ]	Borrowing from banks to find the purchase price
[ ]	Buying at a reduced price for a cash deal
[ ]	Taking out an insurance policy against the possibility of the share value going down
[ ]	Paying a reduced commission to the stockbroker in return for lower dividends

Which group of Americans had invested in new land and equipment in order to export to Europe during the Great War, and then found themselves often bankrupt when the war ended?

[ ]	Coal owners
[ ]	Steelmen
[ ]	Arms manufacturers
[ ]	Farmers

Which of the following is an example of a declining industry, which was unable to benefit from the new ideas that circulated in the 1920s, and which therefore declined further?

[ ]	Shipbuilding
[ ]	Textiles
[ ]	Shoemaking
[ ]	Brewing

What was the minimum registered unemployment figure in the US throughout the 1920s?

[ ]	5 million
[ ]	2 million
[ ]	1 million
[ ]	7 million

What nickname was given to the 1920s decade, suggesting a furious pace of life and rapid changes?

[ ]	The Cool Twenties
[ ]	The Fabulous Twenties
[ ]	The Roaring Twenties
[ ]	The Terrific Twenties

10.

Black Americans missed out on the 1920s spree, but they had always experienced discrimination - so this was nothing new. Which laws discriminated against them, particularly in voting rights?

[ ]	The Penal Laws
[ ]	Old Squaw Laws
[ ]	Jim Crow Laws
[ ]	Uncle Tom Laws

History Quiz - USA: 1919-1932 - The US Economy In The 1920s (Answers)

Which of the following list of US presidents during this period was not a Republican?

[ ]	Harding
[x]	Woodrow Wilson
[ ]	Hoover
[ ]	Coolidge

Republicans were opposed to any state interference in the economy, believing that any problems would iron themselves out naturally

During this period United States governments imposed taxes on the import of foreign goods in order to protect the domestic market. What were such duties called?

[ ]	Levies
[x]	Tariffs
[ ]	Emoluments
[ ]	Fees

Foreign states replied in kind: thus the US found it harder to export its surplus goods abroad, leading to greater unemployment

Which US businessman of this era was most closely identified with mass production, which led to cheaper goods and - temporarily - to more employment?

[ ]	Rockefeller
[ ]	Carnegie
[ ]	Dow
[x]	Henry Ford

Many factories had assembly lines, with each worker carrying out only one or two tasks before the product moved on to the next stage

Which method of purchase became popular in the US before 1929, whereby buyers obtained a loan from the retailer in order to complete the transaction?

[ ]	Mail order
[x]	Hire purchase
[ ]	Discounted buying
[ ]	Using a credit card

Failure to maintain instalments meant forfeiture of the goods, no matter how much of the price had been already paid

Many people were tempted to buy shares traded on the New York Stock Exchange using the "on the margin system". What did this mean?

[x]	Borrowing from banks to find the purchase price
[ ]	Buying at a reduced price for a cash deal
[ ]	Taking out an insurance policy against the possibility of the share value going down
[ ]	Paying a reduced commission to the stockbroker in return for lower dividends

Many people, who had not been involved with the stock market before, were encouraged to buy, believing that the boom in share prices was bound to continue

Which group of Americans had invested in new land and equipment in order to export to Europe during the Great War, and then found themselves often bankrupt when the war ended?

[ ]	Coal owners
[ ]	Steelmen
[ ]	Arms manufacturers
[x]	Farmers

This group never benefited from the 1920s economic boom, and suffered even worse when it came to an end. Many had borrowed heavily during the war, and found it hard to repay these loans after 1918

Which of the following is an example of a declining industry, which was unable to benefit from the new ideas that circulated in the 1920s, and which therefore declined further?

[x]	Shipbuilding
[ ]	Textiles
[ ]	Shoemaking
[ ]	Brewing

Well before the great crash of 1929 not all of America's old, traditional industries prospered

What was the minimum registered unemployment figure in the US throughout the 1920s?

[ ]	5 million
[x]	2 million
[ ]	1 million
[ ]	7 million

Even during the boom years there was never full employment in the US