Presentation on theme: "How did business change during the Industrial Revolution?"— Presentation transcript:
1 How did business change during the Industrial Revolution? Big BusinessHow did business change during the Industrial Revolution?
2 How did business change? Business grew larger and many organized into corporationsCorporations: large, organized companies owned by shareholdersCarnegie, Rockefeller and other leaders were criticized for forming large companiesCritics believed big business was too powerfulThey became monopoliesMonopolies: large corporations that have little competition
3 Why is a monopoly significant? Monopolies can charge higher prices for poorer quality productsThey can do so because they do not have competition from other companies selling the same productThe buyers have no choice but to pay that price or do without the product
4 How were corporations important to business growth? They are a safe form of businessPeople invest money in a corporationThey are protected if the corporation failsInvestors have limited risk or liability for the debtPeople can buy stock in the company with capital (money), in which they earn moneyMajor corporations made millions by selling stock
5 How did companies become larger? Leaders searched for new ways to organize companiesVertical combination: a business that controls each step in making somethingCarnegie bought mining and transportation to help his company produce steelHorizontal combination: buying one’s competitionRockefeller bought out other oil refineries to control oil production
6 What became of the companies? They took business away from the competition and became monopoliesThey were then called trust companiesTrust Companies: A large, powerful company that often is called a monopolyBusinesses were able to increase their wealthCould employ thousands of workersBecame giant industries and very powerful