HISET Social Studies Practice

What was a significant factor during the Great Depression?

1. Increased government spending

2. High levels of unemployment

3. Expansion of industrial jobs

4. Growth in foreign trade

The correct answer is: High levels of unemployment

During the Great Depression, which lasted from the late 1920s through the 1930s, a significant factor was the high levels of unemployment that affected millions of Americans. The stock market crash of 1929 led to a massive decline in economic activity, resulting in businesses closing or reducing their workforce. By the height of the Depression, unemployment rates soared to around 25%, meaning that one in four workers was out of a job. This widespread unemployment had severe repercussions, including loss of income, increased poverty, and social upheaval, significantly shaping the economic landscape and prompting the government to intervene with programs aimed at job creation and economic recovery. In contrast, while increased government spending did occur later as a response to the crisis, it was not a factor that alleviated the immediate impacts of the Depression. The expansion of industrial jobs and growth in foreign trade were also not characteristic during this period; in fact, industrial jobs decreased due to factory closures and foreign trade declined significantly as countries turned towards protectionist policies in an attempt to shield their economies.