Deck 17: Industrial Expansion and Concentration

Question 1

John D.Rockefeller is most recognized for:

A)developing the oil industry.
B)being an early promoter of the computer industry.
C)lobbying the government for the abolition of slavery.
D)inventing new technology to further the steel production process.
E)being an initial supporter of minimum wage laws.

Answer 1

developing the oil industry.

Question 2

Which of the following is an example of a horizontal merger?

A)the consolidation of marketing,processing and purchasing departments by Armour Meat Company
B)the purchase of E.C.Knight Company by American Sugar Refining Company
C)the purchase of Colorado silver mines by the Tiffany Jewelry Company
D)Federal Steel Company's alliance with American Bridge Company

Answer 2

the purchase of E.C.Knight Company by American Sugar Refining Company

Question 3

A _________ is an agreement under which stockholders of several formerly-competing companies turn over their shares to a group that exercises voting control over the companies.

A)trust
B)gentleman's agreement
C)holding company
D)pooling arrangement

Answer 3

trust

Question 4

In the late 1800s and early 1900s,the primary source of energy for manufacturing was

A)coal.
B)petroleum.
C)water.
D)electricity.

Question 5

A horizontal merger

A)combines similar firms that serve separate markets.
B)combines firms that produce similar products.
C)enables a company to control each stage of the production process: from raw materials to the final marketing of the product.
D)enables similar firms to form a cartel.

Question 6

By the eve of World War I,the United States accounted for more than ___ of the world's industrial production.

A)15%
B)30%
C)60%
D)90%

Question 7

The leading producer of manufactured goods in 1900 was

A)the United States.
B)Germany.
C)England.
D)Canada.

Question 8

The term "________" denotes the adaptation of new technological ideas to existing products and services.

A)invention
B)merger
C)innovation
D)economies of scale

Question 9

Between 1860 and 1910,value added by the top ten manufactures roughly

A)doubled.
B)tripled.
C)increased by 500% (a factor of five).
D)increased by 1000% (a factor of ten).

Question 10

By 1916,there were 340,000 corporations in the U.S.The growth in the number of corporations was partly due to

A)increasing numbers of urban dwellers.
B)the development of formal markets for stocks and bonds.
C)the acceptance by most states of the doctrine of limited liability.
D)mass production which led to lower per-unit costs for output.
E)All of the above.

Question 11

The McCallum management principles advocate the use of

A)time-motion study to determine the most productive way to perform job-tasks.
B)employee stock-purchase programs.
C)internal accounting systems and performance evaluations.
D)leveraged buy-outs to increase the firm's control of an industry.

Question 12

Which of the following statements presents accurate information about the Standard Oil merger?

A)The Standard Oil merger is an example of a vertical merger.
B)Standard Oil was initially organized as a holding company.
C)The petroleum refining industry was never particularly competitive,and was dominated by a few large firms even prior to the Standard Oil merger.
D)Following the merger,Standard Oil controlled 90 percent of U.S.refining capacity.
E)All of the above.

Question 13

Henry Ford is most recognized for:

A)inventing new technology to further the steel production process.
B)developing the first investment banks.
C)implementing the first progressive,moving assembly-line system for large,complex final products.
D)playing an integral role in developing the first American factory.

Question 14

"Taylorism" has been described as

A)dehumanizing.
B)the exploitation of labor.
C)using science to increase production.
D)All of the above are correct.
E)Only b and c are correct.

Question 15

Which of the following statements provides the most accurate description of the employment growth rate in various sectors of the economy between 1860-1910?

A)All major sectors grew with the exception of agriculture and construction.
B)All major sectors grew,and agriculture grew the most.
C)The manufacturing sector grew the most,followed by railroads,but agricultural employment decreased.
D)All major sectors grew,and railroads grew the most.

Question 16

The considerable rise of manufacturing in the last half of the 19th century has become known as

A)the Great Leap Forward.
B)the Industrial Revolution.
C)the Second Industrial Revolution.
D)the Ascendancy of Manufactures.

Question 17

During the 1870s,___ surpassed ___ as the leading source of power.

A)animals;humans
B)water;animals
C)steam;water
D)electricity;steam

Question 18

During the 1870s and 1880s,which technological innovation was NOT introduced?

A)the roller mill to process oatmeal
B)steel-bottomed stills
C)long-distance pipelines
D)the typewriter
E) All of the above are correct.

Question 19

As a means of gaining monopoly power,holding companies were preferable to gentlemen's agreements and pooling because

A)holding companies did not have an adverse impact on employment.
B)holding companies were able to reduce competition from imported goods.
C)holding companies were legal in most states.
D)holding companies were not subject to corporate profits taxes.

Question 20

A "vertically integrated firm" is a firm that

A)combines firms which formerly competed.
B)manages all stages of production,from the production of raw materials to the marketing of the final product,within the firm.
C)earns zero economic profits due to the highly competitive market within which it operates.
D)has representatives on its board of directors from many of the companies that it buys from and sells to.

Question 21

The charge that Standard Oil engaged in "predatory pricing"

A)was the driving force behind the Supreme Court's decision to break up the company.
B)makes little sense from an economic perspective.
C)is still subject to debate.
D)All of the above are correct.
E) Only b and c are correct.

Question 22

According to Alfred Chandler,large vertically integrated firms dominated much of American manufacturing in the early 1900s because

A)U.S.manufacturers sought to emulate the production practices of European manufacturers.
B)U.S.tax laws created strong incentives for vertical integration.
C)continuous-flow technologies were cost minimizing only when the inflow of inputs and the sale of outputs proceeded without interruption.
D)larger firms were better able to fight the establishment of labor unions and collective bargaining arrangements.

Question 23

Based on evidence from the turn of the century,the income elasticity of flour and meal

A)is greater than one.
B)is less than one.
C)approaches infinity.
D)equals zero.

Question 24

In U.S.v.Addyston Pipe and Steel Company (1898),the Supreme Court ruled that

A)horizontal mergers were a violation of the Sherman Act.
B)vertical mergers were a violation of the Sherman Act.
C)collusive agreements among competing firms were a violation of the Sherman Act.
D)mergers that created "corporate monoliths" were a violation of the Sherman Act.

Question 25

Recall the text's discussion of the ten largest U.S.industries by value added in 1860 and 1910.The emergence of tobacco products and malt liquors as major industries by 1910 suggests that

A)these goods are highly income elastic.
B)these goods are highly income inelastic.
C)these goods are price inelastic.
D)these goods exhibit economies of scale in production.

Question 26

In U.S.v.U.S.Steel Corporation,the Supreme Court ruled that

A)U.S.Steel had violated the Sherman Act,particularly by organizing meetings with competitors such as the "Gary Dinners."
B)despite the fact that U.S.Steel controlled 50 percent of output in the steel industry,the company had not achieved monopoly power.
C)large corporations,by definition,violate the Sherman Act.
D)the Sherman Act did not apply to U.S.Steel because steel manufacturing was an activity "clothed with a public interest."

Question 27

"Trust busting," including the prosecution of the American Tobacco Company and Standard Oil,was a high priority of _________'s administration.

A)Franklin Roosevelt
B)Ulysses S.Grant
C)James Garfield
D)Theodore Roosevelt

Question 28

Henry Bessemer is most recognized for

A)the invention of air brakes for trains.
B)his role as an early union leader.
C)invention of a steel manufacturing process.
D)the development of refrigerated train cars.

Question 29

A monopsony is a market in which

A)one firm is the sole producer of a good or service.
B)one firm is the sole buyer of a good or service.
C)firms encourage competition by starting "price wars" among competitors.
D)firms collude in setting prices and levels of output.

Question 30

What best describes the changes in steel production from 1860-1910?

A)The open-hearth process quickly became the dominant production process after it was invented.
B)Technological change in steel production changed relatively slowly.
C)No technological changes occurred in the steel industry.
D)The production of steel stayed constant through this period,but it became much more efficient.

Question 31

The History of the Standard Oil Company

A)was commissioned by John D.Rockefeller in 1911.
B)set the standard for modern scientific management.
C)was written by Ida Tarbell.
D)was highly critical of Standard Oil.
E) Both c and d are correct.