A Level History - America - Practice Exam 2025 - Free Practice Questions and Study Guide

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What significant change occurred in the U.S. economic status due to wartime loans during World War I?

U.S. became a debtor nation

U.S. became a creditor nation

The correct answer highlights a key transformation in the United States' economic position as a result of wartime loans during World War I. During the war, the U.S. provided substantial loans and financial support to allied nations, particularly to Britain and France. This influx of lending, combined with the overall demands of war production, positioned the U.S. as a source of capital for countries involved in the conflict.

As the war concluded, many of these nations found themselves heavily indebted to the United States. This marked a shift in America's role in the global economy; rather than being a borrower, the U.S. had emerged as a creditor nation, holding significant financial influence and responsibility for debts owed by other countries. This change laid the groundwork for America's dominant position in international finance in the years to follow, shaping its economic policies and relationships in the interwar period and beyond.

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U.S. dissolved most foreign debt

U.S. stopped all financial support abroad

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