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| Question | Answer |
| Name the seven reasons for the economic boom | 1-Size and economic wealth of US. 2-American Dream. 3- Impact of First world war. 4- Fordism. 5- New management techniques. 6-Government policies. 7- Easy credit. |
| Explain the size and economic wealth of the USA | population 106.4 mill (mass labour force and considerable purchase power)- Infrastructure and natural resources |
| Explain American Dream reason | Yankee ingenuity Edison (telephone, sewing machine and light bulb). American work ethic and individualism - business class and infrastructure, role models such as Carnegie and Rockefeller. |
| Explain Impact of World War One. | Britain and Germany bankrupted themselves fighting WW1. millions owed to US in inter-allied war loan. The demand for armaments in WW1 led to growth in Us industry |
| Explain Fordism | Detroit (Michigan) centre of second American Industrial revelation, a part of this was the new reflationary method of car manufacture created by Henry Ford. new method of mass production involving an assembly line of unskilled/ semi-skilled workers. Assembled parts of Cars quickly and easily leading to rate of production being set. $5 a day rate for workers above other car manufacturers rates but they couldn't join a trade union (yellow dog contract, which was banned in the New Deal) Model T was being produced every 10 seconds. |
| Explain the New Management Techniques. | Frederick Taylor developed the scientific management techniques 'time and motion studies'. Which allowed for the growth of large corporations, the biggest example being the electricity companies. A key figure being Insull (Middle-West Utilities a holding company) he owned 111 division companies with a value of $3 billion. He was able to provide cheap electricity to middle-class Americans. By 1929 16 holding companies owned 90%+ of Us electrical production and 200 corps controlled 20% of the nations and 40% business wealth. The Department of Commerce encouraged trade associations which allowed for the sharing of information to create a standardised manufacturing method. Large corps could borrow money easily for investment. Growth of advertising, added by technological developments (radio, cinema) |
| Government Policies | Republican Government=laissez-faire economics and policies. In 1922 Fordney- McCumber Tariff Act passed which placed duties on lots of imported goods e.g. farm products, chemicals, textiles, chinaware and industrial products.) Federal Trade Commission advised the President to increase tariffs to 50%. Mellon (Secretary to the Treasury) used a series of revenue acts from 1921-'26 he cut the tax on the rich from 50-20% which encouraged a growth in business. There was also less regulation from the Federal Trade Commission and Yellow Dog Contracts were supported by courts. link to new management techniques. |
| Explain Easy Credit and Hire Purchase | Hire Purchase being able to by something at the fraction of the price and paying the rest and some interest in weekly or monthly instalments. Easy Credit being able to take out a loan with out security with not a lot of Federal supervision of the banks |
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