Summary C12-Task 4:1Survey of U.S. History Task 4: The Making of Modern America Task 4: The Making of Modern America A. Explain (suggested length of 2–3 paragraphs) the major causes of the Great Depression (e.g., economic policies, trade concerns, banking pract

C12-Task 4:1Survey of U.S. History Task 4: The Making of Modern America Task 4: The Making of Modern America A. Explain (suggested length of 2–3 paragraphs) the major causes of the Great Depression (e.g., economic policies, trade concerns, banking practices, international commerce). The American economy was declining after World War I. The economy was driven by industrial production to support efforts during the war. After the war ended, production rates dropped. The economy fluctuated throughout the 1920s until 1929, when the stock market crashed. The stock market prices suddenly when down so low, it lost $10 billion in value. Panic and fear of further losses led Americans to sell a lot of their stocks. This ultimately led to the Great Depression. (Norton, 2015) Another reason for the Great Depression was consumer demand. During the late 1920s, demand for new housing, automobiles and electrical appliances declined, leading owners to cut productions and lay off employees. Retailers were not selling much leaving them with large inventories and less income. Farmers were also left with less income as they had overproduced crops. As income decreased and unemployment increased, families could not afford to buy goods. (Norton, 2015) Banking practices were another cause leading to the Great Depression. Many businesses were swimming in debt. Corporations would obtain loans by falsifying their assets to cover up their inability to pay.