Which statement explains why "excessive use of credit" was a cause of the Great Depression?

1) Borrowing money based on the belief that default was an option led people to lie on loan applications.

2) Throughout the 1920s, warning signs of economic collapse made people reluctant to pay cash.

3) Borrowing money based on a belief that the economy would expand led people to take financial risks.

4) Throughout the 1920s, most of the population borrowed money to invest in the stock market.

1

Explanation:

Excessive use of credit was one of the causes of the Great Depression.

From the options provided, Borrowing money based on the belief that default was an option led people to lie on loan applications which in turn contributed to the Great Depression of 1929

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