The consolidation of industry, which so agitated a large seg

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The consolidation of industry, which so agitated a large segment of the public during the late 19th and early 20th century, inevitably gave rise to a countermovement - an antimonopoly or antitrust movement. The antitrust movement is easily explained and understood. It stemmed from the basic belief in an open society, a society in which there were to be no rigid or class lines, a society in which a person or a company ought to be able to rise to the extent to which one's abilities permitted. But the consolidation of the late 19th and early 20th century threatened this open society and free competition itself.

In the 1880's and 1890's, in response to these threats, the antitrust movement became a political issue of importance. There was a marked division of thought as to how the so-called trust problem should be handled. One school of thought - advocated by small businessman and farmers particularly - wanted the trusts destroyed. These people believed that trusts stifled competition and equality of opportunity, and therefore should be wiped out. Many of them, it seems, wanted to get back to a simpler society and economy.

During the 1880s and 1890s, there were other people who believed that the process of business consolidation was perfectly natural and completely inevitable. Moreover, some of them argued that large-scale business was nothing to be frightened about, and that it offered the public certain potential advantages - cheaper production; lower prices, etc. These people recognized, however, that big corporations or trusts might not pass on lower prices to the public, and felt that the government should make sure that the potential benefits of size were indeed obtained by the public. This more reasonable view held that the trusts should not be destroyed, as the other school advocated, but rather regulated and controlled by the government in order to guarantee that the public interest was upheld.

1. The author would most likely support government intervention and regulation in which of the following situations:

A) A company creates a new lifesaving cancer drug that, because of patent protection, is extremely expensive and cannot be afforded by most people suffering from the disease.

B) By purchasing its major rival, a company creates a monopoly for its most important product. Consumers no longer have several options for that product, but prices have gone down.

C) Several companies who sell a similar product collude to keep prices down for that product in order to stifle a major international company that has entered the market.

D) A major electronics company has entered into an arrangement with its two main competitors to make all of their products in the same facility, resulting in cheaper production.

E) A petroleum firm has gained control of 90% of oil reserves in the country. Its strong position has allowed the country to greatly reduce domestic gas prices by undercutting international firms.


Q 2) In regard to the situation in the late 19th and early 20th century, the author would most likely agree with which of the following statements:

A) Large monopolies and the consolidation of business are not in the public interest.
B) Government regulation is usually beneficial to the public interest.
C) Trusts could be beneficial to the public interest.
D) Having a free and open society is essential to the public interest.
E) Trusts should be abolished to benefit the public interest.

Q 3) Which of the following can be properly inferred about the late 19th and early 20th century from the passage above?

A) In U.S. society, people were able to freely move up depending on their abilities.
B) Competition and equality of opportunity were considered important elements of a simple economy and society.
C) Anti-trust issues were debated often in the U.S. Congress.
D) A majority of Americans believed that trusts should be destroyed.
E) Trusts were inherently bad for the U.S. economy.

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Hey, Anaira,
The correct answers are 1) A; 2) C ;3)B.