Economic Impacts of Monopolies and Oligopolies

After the Civil War, the US saw economic growth due to increased tariffs and industrial expansion. The railroad boom created jobs and boosted industries like steel. A national market emerged, leading to intense competition and lower prices, causing small businesses to fail. Large companies formed oligopolies, controlling prices and reducing demand, which led to economic decline. The Sherman Antitrust Act aimed to curb monopolies, but mergers led to large corporations, contributing to the 1907 economic collapse.

What was one of the main economic changes in the US after the Civil War?

• Decrease in tariffs on imports

• Boom in American industry

• Decline in manufacturing

• Reduction in westward expansion

Which industry was significantly boosted by the rise of railroads?

• Automobile

• Steel

• Agriculture

• Textile

How did companies like Sears benefit from the national market?

• By reducing production costs

• By increasing import tariffs

• By selling goods nationwide through catalogs

• By monopolizing local markets

What was a consequence of the intense competition in the national market?

• Bankruptcy of small businesses

• Rise in product prices

• Decrease in consumer demand

• Increase in small businesses

What strategy did larger companies use to maintain high prices?

• Expanding to international markets

• Forming oligopolies

• Increasing production

• Lowering tariffs

What was the effect of oligopolies on the economy?

• Increased investment

• Excess capacity in factories

• Stable economic growth

• Higher consumer demand

What was the purpose of the Sherman Antitrust Act?

• To make price control illegal

• To encourage monopolies

• To promote international trade

• To reduce tariffs

How did JP Morgan and other bankers regain monopoly power?

• By increasing tariffs

• By reducing production

• By investing in small businesses

• By using mergers

What was a result of the monopolization led by investment bankers?

• Economic stability

• Economic collapse in 1907

• Increase in small businesses

• Decrease in consumer prices

Which of the following was NOT a factor in the economic collapse of 1907?

• Increase in small business investments

• Sherman Antitrust Act

• Monopolization through mergers

• Excess capacity in factories