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Trust
- Trust is a set of companies that are managed by a small group known as trustees
- Also known as "Robber Barons"
- Began during 2nd Industrial Revolution
- Trusts were able to manipulate price and quality without regarding to the laws of supply and demand
- Trustees have the power to prevent companies in the trust from competing with each other
Corporations and the Rise of Trust and Monopolies
Causes and Effects
- When a company/corporation eliminates its competition, the company becomes a monopoly
Monopoly
- Monopoly is a single company or corporation that dominates a particular industry
- Ex. Standard Oil (1882), Microsoft, Long Island Railroad, J.P. Morgan
- As businesses expanded, companies/ corporations were looking to dominate competition.
Introduction
Corporations
- Businesses were undergoing major changes in the 1890's
- Business owners devised plans to reduce competition
- Monopoly and Trust
- A corporation recognized by law to exist independently from its owners, with the ability to own property, borrow money, sue, or be sued
- Ex. AT&T, Ford Motor Company, H&M
Monopoly Cont.
- Horizontal Integration is a corporate expansion strategy that involves joining together as many firms from the same industry as possible
- Ex. Apple, Pepsi, Volkswagen
- Vertical Integration is a corporate expansion strategy that involves controlling each step in the production and distribution of a product, from acquiring raw materials to manufacturing , packaging, and shipping
- Ex. 20th Century Fox, Exxon Mobil