2 The trading floor of the New York Stock Exchange Identify1. Explain the significance of: corporation, stock, economies of scale, pool, Andrew Carnegie, vertical integration, horizontal integration, John D. Rockefeller monopoly, trust, holding company.corporation – an organization that is authorized by law to carry on an activity but treated as though it were a single personstock – money or capital invested or available for investment or tradingeconomies of scale – cost of manufacturing is decreased by producing goods quickly in large quantitiesThe trading floor of the New York Stock Exchange
3 Identify1. Explain the significance of: pool, Andrew Carnegie, vertical integration, horizontal integration, John D. Rockefeller, monopoly, trust, holding company.pool – a group sharing in some activity; for example, among railroad owners who made secret agreements and set rates among themselvesAndrew Carnegie – born in Scotland, son of a poor hand weaver; worked his way up to superintendent of the Pennsylvania Railroad; opened steel company in Pittsburgh in 1875, began vertical integration of the steel industry
4 Identify1. Explain the significance of: vertical integration, horizontal integration, John D. Rockefeller, monopoly, trust, holding company.vertical integration – the combining of companies that supply equipment and services needed for a particular industry
5 Identify1. Explain the significance of: horizontal integration, John D. Rockefeller, monopoly, trust, holding company.horizontal integration – combining of many firms engaged in the same type of business into one corporation55
6 Identify1. Explain the significance of: John D. Rockefeller, monopoly, trust, holding company.John D. Rockefeller – famous industrialist who achieved almost complete horizontal integration of the oil industry; built refineries after oil was discovered in Pennsylvania; Standard Oil became the nation’s largest oil refiner, buying out the competition (controlling 90% of the industry in the U.S. by 1880)monopoly – total control of a type of industry by one person or one company66
7 Identify1. Explain the significance of: trust, holding company.trust – a combination of firms or corporations formed by a legal agreement, especially to reduce competitionholding company – a company whose primary business is owning a controlling share of stock in other companies77
8 Main Ideas2. Stating Why did the number of corporations increase in the late 1800s?Companies were allowed to incorporate without getting a state charterCompanies sold stock and, with the profits, were able to achieve economies of scale that smaller companies could not
9 Main Ideas3. Comparing Use a graphic organizer to list ways business leaders in the 1800s tried to eliminate competition.poolsmonopoliesAttempts to Eliminate Competitionvertical and horizontal integrationtrusts99
10 Critical Thinking4. Big Ideas What techniques were used by Carnegie and others to consolidate their industries? How did state governments respond?Pools, trusts, monopolies, vertical and horizontal integrationMany states made it illegal for one company to own stock in another company5. Forming an Opinion Do you think an individual today can rise from “rags to riches” like Andrew Carnegie did? Why or why not?What is it like to find a job today?What is required of workers in order to progress within a company or industry?Does the economy play a role?
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