The Cycle of Prosperity

What is a cycle of prosperity?

During the 1920s the USA entered the cycle of prosperity. This happens when different parts of the economy boost each other and help each other to grow.

How does more money lead to the cycle of prosperity?

When they have more money, people want to buy more. Demand for goods rises.

How does more demand lead to the cycle of prosperity?

In order to meet increased demand, factories make more goods and production rises.

How does more production lead to the cycle of prosperity?

To produce more goods, factories need to employ more people and pay them.

How does more work lead to the cycle of prosperity?

When more people are being paid for working more hours, they have more money, and the cycle continues.