Although the collapse of prices on the New York Stock Exchange in October 1929 caused severe problems in the United States,it had immediate and disastrous consequences in Europe because:
A)European royalty was the primary source of investment capital on Wall Street.
B)the central banks of all European countries had invested heavily in American companies.
C)the United States had become a primary international creditor during World War I.
D)national European exchanges were not large enough to handle the influx of investors.
E)European stock exchanges listed the same stocks and therefore crashed with New York.

Question

Quizplus · Accepted Answer

During World War I, the United States had become a major creditor to European countries by lending them large sums of money. These loans were invested in various American companies, and the collapse of the stock market had a significant impact on their ability to repay their debts, leading to a financial crisis in Europe. Choices A, B, D, and E are incorrect as they do not accurately reflect the main reason for the consequences of the stock market crash in Europe.

Although the Collapse of Prices on the New York Stock