Questions Hard times now

1. How does a person make money on an investment?

Buy something at a cheaper price than you sell it.



2. What makes 'cheap credit' mean?

The economy is going really well and you can get a loan. It means that their is alot of money available. Anyone can go in and get a loan.



3. What is 'buying on margin' mean?

You only have to put 10% of the cost down and you can get a loan for the other 90%. This is a very risky thing to do.



4. How is 'speculation' different from 'investment'?

Speculation is short term buying just for a profit but when your investing its because you believe in the product.



5. How does 'panic selling' start?

It starts when there is a sudden drop in confidence.



6. How can high unemployment start a negative economic cycle?

If people don't make money then they dont spend money. If people don't spend money then the companies dont get money for their products. When they dont get money then they have to lay people off because they're not making enough money then it goes back to people no having money so they don't spend it.



7. How did increases in technology contribute to overproduction in the 1920's?

If you wanted to make something then you have to hire people and you're people more wages to people. When you hire someone then that person can buy the your product and you can make more things with the same people that you have, without hiring anyone new.



8. What is meant by 'uneven distribution of wealth? Is it a bad thing?

There are more poor people then there are rich people. The middle class had to work for wages. Yes it is a bad thing because there are more rich people then poor and people over rule you.



9. What is a tariff, and why don't they seem to work in the modern economy (post-WWI)?

A tariff is an extra tax that you have to pay for imported goods. Its different then it is now.



10. What is 'rugged individualism? Is it real?11. What is a Hooverville, and why is it called that?

Relying on ourselves it fix the econoomy. No, you cant do something like that youself.



11. What is a Hooverville, and why is it called that?Places where lots of people that are homeless and get together.

Places where lots of people that are homeless and get together.