The document discusses the business cycle in the United States in the early 20th century. It summarizes that the Great Depression in the 1930s was caused by inequality in wealth distribution and speculation in the stock market in the 1920s. As wages did not increase alongside production, demand slowed and unemployment rose to 25% of the population. The economy eventually recovered during World War 2 as the U.S. supplied arms to countries at war, enlisting over 10 million people into the military and factories.

1. BUSINESS CYCLE:
THE US
EXPERIENCE
BY-
SAHIBA CHHABRA

2. PROBLEMS-
• 1920’s led to great depression in 1930’s in US
• USA faced its worst economic crises in 1930’s and was described as
great depression
• REASON FOR DEPRESSION- Inequality in distribution of wealth and
heavy speculation on stock market in USA.

3. WAGES
DISPARITY
WHYWAGESLEDTODISPARITYAMONGHAVEANDHAVE-
NOTS

4. INVESTORS BECAME RICH OVERNIGHT BY BUYING AND SELLING STOCKS IN LATE 1920’s

5. ECONOMY BOOMING
• Goods were available on credit and middle class people
started buying on credit.
• This increased the demand for goods in market.
• Producers increased production.
• But as the wages did not increase purchasing power of people
slowed down and demand began to fall.
• Poor demand led to less production and number of employees
were thrown out which led to 25% of population unemployed.
• Prises for agricultural products went down and farmers were
unable to pay their loan.

6. RECOVERY DURING 2ND WORLD
WAR
• USA supplied arms to countries involved in war.
• More than 10 million men and women were enlisted into
military.
• Many people worked in factory to make the supplies for the
war.
• In this way economy started growing gradually.