American Economic History Quiz

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Questions and Answers

What was the primary economic unit in American society around 1820?

Industrial factories

Large corporations

Family households (correct)

Agricultural cooperatives

What is a primary feature of a corporation that differs from a partnership?

Limited liability for shareholders (correct)

Greater required documentation

Incorporation fees

Ability to operate without stakeholders

Which development was crucial for transportation of goods in the early 19th century?

Automobiles

Airplanes

Canals (correct)

Highways

What type of corporation is designed to meet specific social or environmental goals?

B corporation Signup and view all the answers

What significant shift occurred in the American economy by 1920?

Most production came from large factories Signup and view all the answers

What major law was enacted to simplify the process of creating corporations in the mid-19th century?

General Incorporation Act Signup and view all the answers

Which of the following is a characteristic of a sole proprietorship?

No distinct legal separation from the owner Signup and view all the answers

During which economic period was the concept of unregulated capitalism predominant?

1880s to 1920s Signup and view all the answers

What key invention in 1846 significantly impacted clothing production?

Sewing machine Signup and view all the answers

What distinguishes a public corporation from a closely held corporation?

Number of shareholders Signup and view all the answers

What period is often referred to as the golden age of unregulated capitalism in America?

The Lochner Era Signup and view all the answers

Which industry did the factory system first develop within during the early 19th century?

Textile Signup and view all the answers

Which statement about non-profits is true?

They are exempt from corporate profit obligations. Signup and view all the answers

Which demographic shift occurred by 1860 concerning manufactured goods?

They surpassed the value of agricultural production Signup and view all the answers

What is a key feature of cooperatives?

Each member has an equal vote regardless of ownership stake Signup and view all the answers

Which right do corporations have similar to individuals in the United States?

Right of speech Signup and view all the answers

What was one major consequence of deindustrialization in the American economy from 1970 to 2014?

A significant reduction in the percentage of the manufacturing sector in GDP Signup and view all the answers

Which statement accurately describes the impact of financialization on employment and wages?

Wages in the financial sector rose while manufacturing sector wages declined. Signup and view all the answers

What was a result of the deregulation policies introduced during Reagan's presidency?

Enhanced competition in the airline industry after the Airline Deregulation Act Signup and view all the answers

How did globalization affect American businesses in the latter part of the 20th century?

It encouraged outsourcing and offshoring of production. Signup and view all the answers

What is a characteristic of an oligopoly in the context of market control?

A few large companies control most of the market Signup and view all the answers

What characterized the gig economy that emerged in the 2000s-2010s?

The rise of freelance and short-term work opportunities. Signup and view all the answers

What innovation significantly increased cotton production in the 18th century?

Cotton Gin Signup and view all the answers

What is meant by 'emergence of free-floating capital'?

Cash and assets circulating without fixed ties Signup and view all the answers

What was a major economic aspect of slavery prior to its abolition?

It was a massive institution involving a vast number of people. Signup and view all the answers

What are transaction costs in the context of firm development?

Costs associated with searching, bargaining, and enforcement in transactions Signup and view all the answers

By 1860, what fraction of total American exports was represented by cotton?

Two thirds Signup and view all the answers

What was the estimated number of enslaved individuals at the time of the American Revolution?

750,000 Signup and view all the answers

Which company structure is exemplified by a multidivisional corporation?

A corporation where each division operates independently under management Signup and view all the answers

What was a significant consequence of the international slave trade being banned in the US in 1808?

Slave women were encouraged to reproduce Signup and view all the answers

Which factor contributes to the consolidation of industries, as seen in examples like Silicon Valley?

The need for a large workforce with specific technical skills Signup and view all the answers

Which area experienced a tenfold increase in the number of slaves from 1820 to 1860 due to the cotton industry?

Alabama Signup and view all the answers

Which amendment officially ended slavery in the United States?

13th Amendment Signup and view all the answers

What does the term 'King Cotton' refer to in the context of American agriculture?

Cotton's dominance in agricultural exports Signup and view all the answers

What was a major economic value of the slave trade estimated by historians?

$3.5 billion Signup and view all the answers

Which city is specifically mentioned as having grown around the commerce of cotton?

New Orleans Signup and view all the answers

What was the middle passage in the context of the slave trade?

The crossing from Africa to the Americas Signup and view all the answers

What factors could influence the price of a slave at an auction?

Skill set and health condition Signup and view all the answers

Which statement best describes the ownership of slaves in the South?

Only a small minority of white people in the South had slaves. Signup and view all the answers

What type of slaves lived closer to their owners and had more privileges?

Domestic servants Signup and view all the answers

Which of the following was a characteristic of the networked firm during the age of commerce?

Merchants organizing production without needing a corporation Signup and view all the answers

What best explains vertical integration in the context of American business history?

Purchasing companies at all levels of production Signup and view all the answers

Which economic model was primarily active from the 1830s to the 1970s?

The vertically integrated firm Signup and view all the answers

Which company exemplified vertical integration by controlling multiple levels of oil production?

Standard Oil Company Signup and view all the answers

What was a common living arrangement for slaves on plantations?

Staying in separate slave quarters Signup and view all the answers

Study Notes

Week 1: 9/26

Corporation: A legal entity defining a company, offering limited liability to shareholders.
Shareholders do not lose more money than they invested.
Incorporation: Creation of a company by two individuals. The company is a separate entity from the individuals involved.
- It has perpetual life until dissolved.
- It can raise large amounts of money.
- Partnerships do not incorporate, and owners are not protected against liability.
Dividends: Shareholders' proportion of the profit.
Corporate types:
- C corporation: Standard corporate form.
- S corporation: Small corporations (100 or fewer shareholders).
- B corporation: Focuses on beneficial impact, not just profit. Ex: Ben & Jerry's.
Public corporations: Company shares traded on stock exchanges, able to be bought by anyone.
Going public: Company shares become available for purchase on the stock market.
Closely held corporations: Limited number of shareholders.
Non-profit corporations: Do not aim for profit, such as churches, hospitals, universities, and cooperatives.
- Cooperatives: One member, one vote.

5 Economic Periods

Agrarian-commercial society: Colonial slavery era (17th-19th centuries), characterized by trade between continents.
Industrial Revolution: (1810s-1900s) Major change in transportation and production.
Unregulated capitalism: (1880s-1920s). Little government regulation, corporations grow powerful.
Fordism/New Deal consensus: (1920s-1970s). Mass production, government intervention.
Financial capitalism: (1970s-present). Emphasis on finance and globalization.

Week 2: 10/03

1880s-1920s (Unregulated capitalism): Businesses grow large, and Supreme Court rulings limited the government's ability to regulate businesses.
Laissez-faire philosophy: Little government regulation on business.
Progressive Era: 1890s - 1910s.
- Ex: 1890 Sherman Antitrust Act
- The government tried to regulate large corporations to prevent monopolies.
Great Merger Movement: Corporations merged to become bigger and more powerful in the late 19th and early 20th centuries.
Pure Food and Drug Act (1906): The government started inspecting food and medicine safety.

Week 3: 10/10

1970s (Financial capitalism): Period after the New Deal where the economy focused less on manufacturing and more on finance.
Stagflation: High inflation and unemployment simultaneously.
Deindustrialization: Factories move, or close resulting in less employment in the manufacturing sector.
Financialization: The economy's shift towards finance.
Deregulation: Reduction of government control of corporations.
- Airlines Deregulation Act of 1978.

Week 6: 11/7

Three ages of American Business: A series of eras of evolving forms of business organization:
- Networked Firm (1600s-1830s): Merchant-dominated, coordination of producers to sell goods.
- Vertically Integrated Firm (1830s-1970s): Focus on controlling many parts of a product's supply chain to increase efficiency. Ex: Standard Oil.
Conglomerates: Companies with diverse operations, diversifying risk, and gaining larger market share. Ex: Silicon Valley tech giants.

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Description

Test your knowledge of American economic history with this quiz covering essential developments from the early 19th century to 1920. Explore key concepts like corporations, capitalism, and the factory system. This quiz is perfect for students of American history or economics.