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A problem for people who bought stock on credit during the 1920s was that if the stock market collapsed, they:

A. would owe more than they could repay.
B. would have to buy more stock on speculation.
C. would have to buy more stock on margin.
D. would lose a little money in their stock.

Sagot :

GinnyAnswer

Final answer:

Investing on margin during the 1920s stock market presented significant risks due to potential stock price declines, resulting in owing more than the stock value.


Explanation:

Buying on margin was a risky practice during the 1920s in the stock market. Investors would borrow money to purchase stocks, using existing stocks as collateral. If stock prices fell and declined significantly, investors could end up owing more than the value of their stocks, leading to financial trouble.


Learn more about Stock Market Investing in the 1920s here:

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