USA HISTORY

Detailed explanation-1: -In the 1920s, there were lots of new products available like automobiles, washing machines, and radios. Advertising convinced people that everyone could afford these items by borrowing money. As a result, many people went into debt buying products they couldn’t afford.

Detailed explanation-2: -Newly developed innovations like radios, phonographs, vacuum cleaners, washing machines, and refrigerators emerged on the market during this period. These new items were expensive, but consumer-purchasing innovations like store credit and installment plans made them available to a larger segment of the population.

Detailed explanation-3: -One explanation for the triumph of the consumer culture is that manufacturers kept introducing more and more useful and enticing products while, at the same time, credit became more available to more Americans.

Detailed explanation-4: -As consumers bought more on the installment plan, the debt forced some to reduce their other purchases. As sales slowed, manufacturers cut production and laid off employees. Jobless workers had to cut back purchases even more, causing business activity to spiral downward.

Detailed explanation-5: -Installment buying and easy consumer credit helped the economy boom. Americans bought more and more new goods because they could pay for them over time. As much as 60 percent of new furniture and 75 percent of radios were purchased on installment plans.