Download A Business Boom

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A Business Boom
TEKS
5(B), 10(A), 22(C), 23(A), 23(B), 25(C)
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Listen
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Industrial growth soared for businesses such as oil and steel, and
and
new businesses arose to meet the demands of auto travel.
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As consumers bought, productivity rose to meet the demand. The Gross
National Product (GNP), which is the total value of goods and services a
country produces annually, rose at an average of 6 percent per year.
year. One
sector of great growth was in the automobile industry, largely due
due to the
efforts of Henry Ford. He wanted ordinary people to have cheap cars,
cars, so he
adapted the assembly line,
line, the process in which each worker does one
special task to make it more efficient.
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MassMass-media advertising also began in the 1920s, persuading people
to buy more and more. Advertisers appealed to people’s emotions,
promoting products by implying that they would enhance someone’s
image or make someone socially acceptable.
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Many features of modern American society were born in the 1920s. FastFast-food
chains and shopping centers appeared. Americans bought new appliances
appliances in
record numbers, creating a demand for more electrical energy. The
The 1920s
created a consumer economy that depended on people spending large
amounts. Businesses also introduced paying by installment plan,
plan, which
allowed payment for items over a period of time. This encouraged consumers
to spend more money and go into debt.
Some people and industries, however, did not profit from this
economic boom. Unskilled laborers and migrant workers remained
poor. The farm economy was slumping as Europe recovered from
World War I and bought fewer American farm products. The coal and
and
textile industries and the railroads suffered when markets dried up.
A Business Boom
Begin Taking Notes
What role do businesses and consumers play in a consumer
economy?
2. How were Henry Ford and the automobile important to the 1920s?
3. In what ways did industrial growth affect the economy of the 1920s?
1920s?
4. Why did the economic boom bypass some people and benefit
others?
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A Consumer Economy
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The 1920s saw the development of a consumer economy,
economy, one that depends on a large
amount of spending by consumers.
Until the 1920s, middlemiddle-class Americans generally paid cash for everything. Manufacturers
Manufacturers
developed installment plans and clever advertising to encourage consumers to buy on
credit.
Many new electric appliances created a surge in demand for electricity.
electricity. Between 1913 and
1927, the number of electric power customers quadrupled.
A Consumer Economy
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By the 1920s, marketers developed a new approach to advertising. Advertisers used
psychology to appeal to consumers’ emotions and insecurities to sell products.
As consumption rose so did productivity. A measure of productivity
productivity is the Gross National
Product (GNP).
(GNP). The GNP is the total value of goods and services a country produces
produces
annually.
Productivity rose to meet consumer demand, but it also rose because
because the nation developed
new resources, new management methods, and new technologies.
Ford and the Automobile
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In 1896, Henry Ford perfected his first version of a lightweight
gas.” The improved
gas-powered car. He called it the “quadricycle
“quadricycle.”
version was the Model T.
Ford wanted to produce a large number of cars and sell them at
prices ordinary people could afford.
Ford and the Automobile
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To sell less expensive cars, he adapted the assembly line for his factories. An assembly
line is a process in which each worker does one specialized task in the construction of a
final product.
Ford’s success came partly from vertical consolidation—
consolidation—controlling the businesses that
make up the phases of production.
Ford was a complex businessman. His pay rate was very generous, but he used violence
to fight unions.
Industrial Growth and Bypassed by the Boom
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Industrial Growth
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Automobile making became the nation’s largest industry.
Thousands of new businesses arose to serve automobile travel.
Other nonnon-automobileautomobile-related industries grew as well.
Limited government regulation (laissez(laissez-faire policies) helped the value of businesses to soar.
Rapid business expansion opened up opportunities for small companies.
companies.
Bypassed by the Boom
Some Americans struggled to survive during the 1920s.
Many unskilled laborers remained poor, and their wages and working
working conditions did not improve with the boom.
Agricultural industries had expanded to meet wartime needs but later
later failed to uncover new markets.
Railroads suffered from shrinking demand, mismanagement, competition
competition from trucking firms, and labor unions that
fought against layoffs and wage cuts.
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A Business Boom—
Boom—Assessment
What was the new approach to advertising in the 1920s?
(A)
(B)
(C)
(D)
It
It
It
It
informed the consumer about the quality of the product.
showed the product’s superiority over the competition.
appealed to the emotions and insecurities of the consumer.
helped the consumer to identify the manufacturer.
In the United States which group suffered economically in the 1920s?
1920s?
(A)
Unskilled laborers
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(B)
(C)
(D)
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Agricultural workers
Railroad companies
All of the above
A Business Boom—
Boom—Assessment
What was the new approach to advertising in the 1920s?
(A)
(B)
(C)
(D)
It
It
It
It
informed the consumer about the quality of the product.
showed the product’s superiority over the competition.
appealed to the emotions and insecurities of the consumer.
helped the consumer to identify the manufacturer.
In the United States which group suffered economically in the 1920s?
1920s?
(A)
(B)
(C)
(D)
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Unskilled laborers
Agricultural workers
Railroad companies
All of the above
Work
Look over your notes from today.
1. Answer the 4 questions from today’s lecture.
2. In five sentences, write a brief summary of what we went over in class today. Use the
highlighted key terms in your summary!
Title the paper the same as the Lecture Notes.
Make sure to put your Name,
Name, Date,
Date, and Period in the upper right hand corner of your page.
Turn this in at the beginning of class tomorrow – put it in the handhand-in/collection basket.
Worth 25 out of 100 points for this week’s Daily grade.
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