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AP U.S. History 2.2 Period 6: 1865-1898 230 Views
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AP U.S. History 2.2 Period 6: 1865-1898. In this AP U.S. History question determine why the structures of companies in industries like steel began to change in the late 19th century.
Transcript
- 00:00
[ musical flourish ]
- 00:03
And here's your Shmoop du jour, brought to you by vertical integration,
- 00:07
the ultimate solution for ending size and shape discrimination.
- 00:11
During this time, the structure of companies and industries
- 00:13
like steel changed because companies... what?
Full Transcript
- 00:17
And here are your potential answers.
- 00:19
[ screaming ]
- 00:22
We know during this time that steel and oil companies were run
- 00:25
by people with a thirst for profit.
- 00:27
These men turned their sights on making their companies
- 00:30
as big and powerful as possible,
- 00:32
all in the interest of earning more of that sweet, sweet green.
- 00:34
Let's see which answer best describes how the industrialists
- 00:37
could alter those companies to line their pockets
- 00:40
with even more dough.
- 00:41
Did the structure of big companies change because they
- 00:44
B - began to outsource their distribution networks?
- 00:47
Well, if you wanted more control over your company,
- 00:49
you probably wouldn't outsource parts of the process to other people.
- 00:52
Was the structure of these industries changing because they
- 00:55
C - lost their monopolies? Well, actually,
- 00:57
their monopolies were stronger than ever.
- 00:59
By consolidating their business and focusing even more ruthlessly
- 01:02
on the bottom line, companies became so
- 01:04
powerful that they didn't even have to rely on Congress for favors.
- 01:07
So that knocks out C and D.
- 01:09
Which means that these companies were changing because they
- 01:13
A - came to control all steps of the production process.
- 01:16
Remember the term "vertical integration"?
- 01:18
That's when a company comes to control every step of the production process
- 01:21
from harvesting the raw materials all the way
- 01:24
up to selling the final product.
- 01:25
And it eliminates the ineffiency of having a middle man
- 01:28
so these big companies consolidated
- 01:30
all the business under one roof,
- 01:32
driving profits even higher.
- 01:34
So A is the correct answer. Looks like the industrialist
- 01:36
top-down approach was, well, from the top down.
- 01:40
[ angelic harmony ]
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