Answer:
D: The stock market crash
Explanation:
I’m so sorry I’m just really interest in the economy and politics so here’s an in-depth explanation:
Why it’s not:
❌A: the overproduction of goods
Reasoning:
The reason for the over population of goods was that they invented machines to produce quickly due to the high demand, the stock market and the consumer confidence was high. Making farmers want to sell more to make profit.
❌B: speculation in the stock market
Reasoning:
Due to the the stock market being successful, others tried to use it as a get rich quick scheme. This led to risk taking such as buying on margin and speculation.
Buying on margin: Buying Stock on credit (Taking loans)
Notes:
Investors began buying stock with credit, hoping and assuming that the the price will rise.
Speculation: Making an investment and hoping the prices rise so they can make a huge profit.
Notes:
The act of gambling your savings, if this fails they go into debt as they are unable to afford and pay back the loan, therefore making them lose more money than earning.
❌C: The overvaluing of stocks
Reasoning:
The overvaluing of stocks is the act of buying something and selling it for a higher price. This leads to overpriced items, slowly making the consumer confidence decrease.
