Answer:
(a) Overproduction led to the economic depression and the collapse of the American stock market. (b) American farmers had greatly increased their production during the war to feed their allies. But after the war, the demand for foodstuffs was drastically reduced and the prices fell. (c) The capitalists tried to increase their profits and paid low wages to the workers. Thus goods remained unsold in America and there was not much demand in Europe due to the collapse of its economy after the First World War. (d) Americans began to speculate in the stock market with borrowed money. As a result in October 1929, the New York Stock Exchange collapsed. (e) Value of shares dropped drastically. Vast fortunes were wiped Ol1t. Hundreds of American banks. Factories, mining companies and business firms went bankrupt. There was large scale unemployment, poverty and starvation.
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