6
QuizMultiple Choice

Boom and Bust

Question 6 • [HSSUS] US History, Sem 1 (26-27)

Which best explains how the overproduction of goods in the 1920s affected consumer prices and the economy?

Answer
A
Prices fell as consumer demand increased, and the economy grew.
B
Prices increased along with consumer demand, and businesses prospered.
C
Prices fell as consumer demand decreased, and the economy slowed down.
D
Prices increased but consumer demand decreased, and the economy grew.

Explanation

In the 1920s, businesses produced more goods than consumers could buy. This oversupply put downward pressure on prices, while weak consumer demand left businesses with unsold products and reduced profits. As production and business activity slowed, so did the economy. Choice C correctly describes falling prices, decreasing consumer demand, and an economic slowdown.

AI-written and checked against the verified answer.

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