EXAM_2_Study - Alexander Muhr HIST-215 DAY 1 BIG BUSINESS o...

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Alexander Muhr 10/23/05 HIST-215 DAY 1: - BIG BUSINESS: o Technology caused development o Quickness legal system that doesn’t let companies become CARTELS; legal in EUROPE - Before 1870 much more open economic sections o Relatively easy to join economic fields o Almost NO GOV’T laws related to Big Business - After 1870 LARGE FIRMS – barriers of entry! o Probability of success very low o OLIGOPOLY 3-15 firms that DOMINATE Complex technology - Personal Characteristics = reason of success of business!! - Victimization of Big Business – laws begin to be proposed - Improvement in Distribution of GOODS o RR extensive o More production = more selling o Firms take more control of selling and marketing o BRANDING - Big Business has more POWER than EVEN = RESENTMENT - Mass Production = Mass Sales - 2 STRATEGIES OF GROWTH o Horizontal Combination: firm buys/merges with another that does similar or same work o Vertical Combination: companies do more than one function in control of their product - Backward towards the simplest of materials – raw materials - Forward towards the distribution/sales of product - Vertical Integration: (Backward = DEFENSIVE move) o Reduce vulnerability of raw materials being stopped o Not necessarily to enhance profitability o Less subject to DISPUTES o Carnegie = IRON ORE or Fuels (COAL) o INSURANCE POLICY o DuPont = buy up nitrate fields in Chile o SOURCES = LIMITED - Vertical Integration: (Forward = OFFENSIVE move) o Late 19 th C. companies that are in sophisticated technology (refrigeration, telephones, electricity) o Selling ICE Refrigeration Machinery - Refrigerated RR CARS – build yourself – store produce yourself – slaughter yourself o Animal Processing; Auto – BIG BUSINESS o Starts off Vertically Integrated = OLIGOPOLY
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Alexander Muhr 10/23/05 HIST-215 o Winner = Consumer - BANANAS United Fruit, Standard Fruit - Harvesting Machinery Expensive, sold through franchises, KNOWLEDGE - Electrical Industry KNOWLEDGE - Sales Engineer – fair amount of TRAINING, can figure out what customer needs DAY 2: - THOMAS A. EDISON o Telegraph (born during period of much change) o Home schooled o RR sold stuff – published own paper o Became more deaf over lifetime o Revolutionized telegraph industry o Western Union o Ticker machine o Menlo Park 1876 “Invention Factory” One Invention every SIX months o Recording SOUND!! Phonograph o World Famous o Electric lighting Incandescent Lamp o Portland cement, phonographs, Edison GENERAL ELECTRIC, Storage Batteries o Built FIRST movie studio first movie camera!! o Friendship with Ford o Over 1,000 inventions!! DAY 3: - Horizontal Integration Industries subject to Economies of SCALE o Strategy to get Larger buy similar companies o STANDARD OIL – Rockefeller At one point owned 90% of refining in America - Petroleum Business o Refined into KEROSENE for Lighting o Rockefeller recognized Economy of SCALE - OIL Industry o George Bissel – discovered mechanism for refining petroleum into
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EXAM_2_Study - Alexander Muhr HIST-215 DAY 1 BIG BUSINESS o...

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