The Beginning of U

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The Beginning of U.S. Debt   1.   Even before the United States was founded in? 1776, debt existed. Paying for the American Revolutionary War? (1775 -? 1783) was the start of the? country's debt. Some of the founding fathers formed a group and borrowed money from France and the Netherlands to pay for the war. To manage the new? country's money, the Department of Finance was created in 1781.     World War I? (1914-1918) to the Great Depression? (1929-1941)   2.   The U.S. government needed to raise money in preparation for their participation in World War Ilong dash—the first major war between the countries of Europe in modern times. To do? that, the government raised taxes. By the end of the? war, the? government's debt was more than? $25 billion.   3.   In? 1929, the U.S. economy collapsed. This was the beginning of the Great Depression. One thing that triggered the Great Depression was the crash of the stock market on? Tuesday, October? 29, 1929. During the? Depression, the? government's debt began to grow again since it was not collecting much money in taxes.           long dash—United States Department of the? Treasury: Bureau of the Public Debt. The History of U.S. Public? Debt: The Beginning of U.S. Debt and World War I through the Great Depression. Aug. 2010. Accessed 15 May 2011.

 

 

 

Part 1

 

Based on paragraph 1 and the first? graphic, how did the U.S. debt? begin?

 

 

A.

The debt began after the Revolutionary War ended and doubled in the first eight years.

 

 

B.

Our founding fathers borrowed over? $83 million to pay for the new infrastructure of the country.

 

 

C.

In

1783?,

the U.S. debt was? $43 million due to the cost of the American Revolutionary War.

 

 

D.

The debt began during the Revolutionary War and went from the millions to billions in 50 years.

 

2.Based on the reading and the

graphics?,

what is the largest factor in creating U.S.? debt?

 

A.

The preparations for the United States to enter World War I.

 

 

B.

When the United States is preparing? for, or in a? war, the debt goes up.

 

 

C.

When the government raises taxes.

 

 

D.

The time leading up to the stock market crash.

 

 

 

3.What could have caused the United States debt to decrease from 1920 to? 1929?

 

A.

The United States debt goes up and down over time on a regular basis.

 

 

B.

There were no wars to pay for and the government raised taxes.

 

 

C.

Other countries borrowed money from the United States

 

 

D.

Other countries refused to pay back money they borrowed from the United States

 

 

 

4.Based on paragraph 2 and the second? graphic, what changed about the U.S. debt from 1914 to? 1920?

 

A.

Due to the U.S. involvement in World War? I, the debt increased from? $2.9 to? $25 billion.

 

 

B.

The government raised taxes which helped to control the debt.

 

 

C.

The debt increased due to the Great Depression.

 

 

D.

The changes in debt were smaller on the second graph than on the first graph in this passage.