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Describing the international debt structure of the 1920s:

A. European allies of the U.S. in WWI borrowed money from the U.S. to pay back earlier debts, thus incurring more debt.

B. The U.S. forgave most of their European allies' debts from WWI.

C. The U.S. forgave Germany and Austria's WWI debts.

D. France was the only healthy economy standing after WWI.

Answer :

Final answer:

The international debt structure of the 1920s was marked by increased borrowing from the US by European allies. Contrary to forgiving debts, the US lent more money, leading to deeper financial troubles for these nations. This situation contributed to the instability that preceded the Great Depression.


Explanation:

International Debt Structure of the 1920s


After World War I, the international debt structure was significantly affected by the financial interactions between the United States and European nations. During the 1920s, many European countries, particularly the Allies, borrowed substantial sums from the US to pay off their earlier debts incurred during the war. This led to a cycle of debt as these nations struggled to manage their payments, especially in the face of economic difficulties.


A key aspect of this structure was that rather than forgiving debts, the US continued to allow loans, which further increased the financial burden on its European allies. The statement that the US forgave most of their debts is inaccurate. Also, while there were discussions regarding the debts of Germany and Austria, the US did not fully forgive their obligations.


By the end of the 1920s, European economies were in turmoil, contrary to the notion that France was the only healthy economy left after the war. Many European countries faced significant financial challenges, which contributed to the eventual onset of the Great Depression. Thus, the debt structure of the 1920s was characterized more by rising debts and economic instability rather than forgiveness.


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