Unit 2 Test- Industrialization Flashcards
Rebates
a secret discount railroads sometimes gave to their large customers
paybacks
you pay in full price, and the money you get back is your rebate.
Rockefeller would go to the railroad companies and force them to make the prices higher, but to give him rebates on the prices. This eliminated the smaller competition (oil companies) who couldn’t pay the higher price
Every person who could afford rebates became much more successful than those too poor to afford them.
Monopoly
an enterprise that is the only/biggest seller of a good or service
Had too much power over the price and production of goods
a company that wiped out its competitors and controls an industry
Trusts
A trust is a large grouping of business interests with significant market power, which may be embodied as a corporation or as a group of corporations that cooperate with one another in various ways.
trusts could artificially inflate prices, bully rivals, and bribe politicians
A legal body created to hold stock in many companies, often in the same industry.
Sweatshops
usually a small manufacturing establishment employing workers under unfair and unsanitary conditions.
poor working conditions, unfair wages, unreasonable hours, child labor, and a lack of benefits for workers
6 causes of industrialization
Human Talent & Labor:
Growing population, including millions of
immigrants brought new workers and talent
Railroads:
Improved transportation, allow exchange of resources, people, and goods throughout the U.S.
Inventions & New Technology:
New technology made new industries possible and more efficient
Government:
Government gave land away and gave
subsidies ($ to help grow) to railroads
Natural Resources:
Westward Expansion provided access to more resources like coal, iron, lumber etc
Investment:
Many hoped to profit so they lent money to businesses
What is a patent?
Why would an inventor need one?
a government document giving an inventor the sole right to make and sell an invention for a particular number of years.
To protect their idea and be able to profit from their innovation.
What changes occured in America in the mid and late 1800s?
Factory machines replaced hand tools.
Manufacturing and large-scale industries began to replace farming.
How was the Bessemer process a cause of industrialization?
The Bessemer process cut the cost of making steel, making it more affordable. The use of steel lead to the development of new industries.
What products used steel?
Plows, barbed wire, nails, beams for buildings (skyscrapers)
What specific contributions did Thomas Edison make?
Edison invented a practical, sage light bulb as well as a system to deliver electricity to people (power plant)
Explain the importance of Alexander Graham Bell
Bell invented the telephone which would revolutionize communication.
What other new technologies were developed at this time?
-Telephone networks rapidly expanded, especially with the development of the switchboard
-The typewriter opened up jobs for women
-Issac Singer’s sewing machine led to more factory produced clothing rather than homemade
What did the reorganization of the business world change?
The way that it was managed and financed, leading to less competition
Define corporation
a business that is owned by investors who purchase part of it through shares of stock
a business owned by shareholders
Define shareholder
an investor who purchases part of a business through shares of stock
Why did corporations develop in the late 1800s? How would a business be helped by turning into a corporation?
To be able to afford new technologies, business owners turned their businesses into corporations where investors would give money to the company in return for ownership of part of it.
How did John D. Rockefeller obtain a monopoly over the oil industry?
He bought out the other oil refineries, made deals with railroads to ship his oil at cheaper prices, and built or bought his own pipelines for carrying oil.
Why did Rockefeller develop the Standard Oil Trust?
To merge multiple corporations together under one body which then controlled 95% of the nations oil (monopoly)
Define “robber baron”
a business leader who uses dishonest methods to grow rich.
Reasons: Business leaders built their fortunes by stealing from the public.
They drained the country of its natural resources.
Why did this lead to Rockefeller being labeled as a “robber baron?”
Rockefeller raised the price of oil for customers. Since they could only get it from his companies, they had to pay whatever the price was.
How did Andrew Carnegie’s methods in the steel industry differ from Rockefeller’s with oil?
Carnegie tried to make the best and cheapest product in order to beat his competition rather than forcing them out of business like Rockefeller. To do this, he bought up all the phases of steel production, from the raw materials to the finished product. By cutting out the middle man, he was able to reduce the cost of his steel.
Describe Rockefeller and Carnegie’s philanthropy.
Both men gave away very large sums of money to universities and to build public libraries.
Define business cycle
cycle of economic “boom” times (up) and “busts” (down)
What constitutes and boom and bust period?
A boom period is where people are buying goods and investing in businesses. A bust is when spending and investing decrease which leads to industries laying off workers.
Define depression
a period of extremely low economic activity
What are examples of depressions during the period of industrialization?
There was an economic depression in 1873 which lasted five years and left 3 million unemployed. The depression of 1893 saw thousands of businesses close although industry grew steadily throught the 1800s.
Describe the varied impact of America’s economic growth on its people
Some Americans became very wealthy and the standard of living rose. Minorities, factory workers and many in the South did not benefit greatly from this growth, however.
