Survey
* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project
* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project
Monopolies What is a Monopoly? 1. A monopoly is when someone has exclusive control or possession of something. 2. We are going to learn: a. b. c. How businesses in the late 1800s and early 1900s were turning into monopolies in order to dominate. Some business owners got extremely rich. Why the government had to step in. Understanding a Monopoly 1. Let’s pretend that there are two students, Billy and Jimmy, selling candy at school. 2. Both students are selling candy and competing with each other to gain more candy sales. 3. Billy does not want to compete and wants to be the sole candy seller at school. He does whatever he can to put Jimmy out of business. 4. Billy is successful and now is the only candy seller in the school. 5. This is what it means to have a monopoly. Owning something completely without competition. Class Activity 3 students will represent 3 different cell phone companies. 1. a) b) c) 1st student = Verizon - $120 per month 2nd student = T-Mobile $90 per month 3rd student = AT&T - $100 per month 2. Students at their desks should vote with who they will buy a cell phone from. 3. Student 3 will now “buy” student 2’s company leaving just Verizon and AT&T. Now who will you buy cell phones from? 4. Student 1 will then “buy” student 3’s company leaving just Verizon. Now who will you buy a cell phone from? 5. Now ask the students if this is a fair idea. What did Verizon eliminate buy buying out the cell phone industry? 6. That’s right! COMPETITION. There is no competition to reduce prices for the consumer. History of Monopolies 1. Monopolies were popping up all over the place in the late 1800s and early 1900s. Many business owners began having individual control over what they were selling with no competition. 2. Industries such as oil, railroads, banking and tobacco were being dominated by monopolies. Robber Barons 1. The people who ran monopolies were called Robber Barons. 2. People such as Andrew Carnegie, John Rockefeller, J.P. Morgan and James Buchanan Duke all dominated their industry. Andrew Carnegie 1. Carnegie would dominate the steel business. 2. He would have most of the steel produced in Pittsburgh, PA (Hence the Pittsburgh Steelers) 3. He would found a famous college in Pittsburgh named after himself called “Carnegie”. 4. He was worth roughly $298 billion in today’s money. John Rockefeller 1. Rockefeller dominated the oil business. 2. Rockefeller Center in NYC would be built by his family. 3. He would help found the University of Chicago. 4. He was worth about $633 billion in today’s money. J.P. Morgan 1. Morgan would dominate the finance and banking world. 2. J.P. Morgan / Chase Company is a leader in banking and finance today because of J.P. 3. He was worth about $1.7 billion in today’s money James Buchanan Duke 1. James Buchanan Duke dominated the business of tobacco in the south. 2. He would call Durham, North Carolina his home. 3. He helped found Duke University 4. He was worth about $150 million in today’s money. Problem with Monopolies 1. While monopolies were popping up left and right in the late 1800s and early 1900s, they were believed to be a bad thing for America. 2. There was a lack of competition which meant that monopolies could dictate the price of a good and service without worrying about competitors. 3. Think back to Billy and Jimmy selling candy. They were competing against each other which meant that the candy price would have to be cheaper in order to gain more business. 4. This is where the government steps in… US Government Intervention 1. The government say that these monopolies were controlling the price and that it was becoming unfair and out of control. 2. The Sherman Antitrust Act was passed in 1890 in order to prevent monopolies while encouraging competition in the free market. Legacy 1. With the government stepping in to prevent monopolies, people have questioned government intervention in the free market. 2. What do you think most of the arguments are amongst politicians? They debate back and forth whether they should have more or less government involvement in this type of area. 3. What do you think? Write your response in the space below.