Gilded Age: Question 1 of 100
In the period from 1865 to 1900, the United States Government aided the development of the West by
  1. maintaining free and unlimited coinage of silver
  2. offering low-interest loans to businesses
  3. granting land to railroad companies
  4. providing price supports for farm products
Correct Answer Number: 3
Explanation: The development of the American west was greatly aided by the development of the railroad. The development of the railroads in America eventually became a corrupt process. Government involvement lead to a scandal under the administration of U.S. Grant. The control of the railroads by a few companies also brought them into conflict with farmers and the government later on.
Gilded Age: Question 2 of 100
In the United States, the main purpose of antitrust legislation is to
  1. protect the environment
  2. increase competition in business
  3. encourage the growth of monopolies
  4. strengthen the rights of workers
Correct Answer Number: 2
Explanation: Trusts are monopolies that control all or most of the sales of a specific good or product. Antitrust legislation passed during the late 19th and early 20th centuries was designed to stop found to be “in restraint of trade”. Famous antitrust actions from US history include; the 1911 case of Standard Oil Company of New Jersey vs. United States and the court ordered “break-up” of the American Telephone and Telegraph (AT&T) in the early 1980’s.
Gilded Age: Question 3 of 100
Prior to 1890, United States businesses made few foreign investments mainly because
  1. state governments discouraged foreign investments
  2. foreign investments were prohibited by Congress
  3. foreign nations did not accept investments from United States businesses
  4. investment opportunities were better in the United States
Correct Answer Number: 4
Explanation: During the late 19th century and the early 20th century, the United States was not seen as a “world power”. As such their political and economic intersects did not reach beyond our borders. The result was a lack of US involvement in foreign affairs and business. This would all change after the US’s involvement in the Spanish-American war (1898).
Gilded Age: Question 4 of 100
The Federal Trade Commission, the Interstate Commerce Commission, and the Federal Communications Commission are similar in that each
  1. represents the interests of big business
  2. is specifically provided for in the United States Constitution
  3. has the power to formulate and enforce regulations
  4. must get approval from the states to carry out national laws
Correct Answer Number: 3
Explanation: Following the abuses of the Gilded Age, many saw a need for stricter government regulation of the US economy. This resulted not only in antitrust measures, but an increased number of federal agencies. These agencies became responsible for monitoring and regulating a specific segment of US economic activity. The FTC (regulates products that are traded), ICC, (regulates interstate trade) and the FCC (regulates communications such as telephone and television) are three such examples.
Gilded Age: Question 5 of 100
“Prices and wages should be determined by the marketplace.” The author of this statement would most probably support
  1. government ownership of utilities
  2. minimum-wage laws
  3. wage and price controls
  4. laissez-faire capitalism
Correct Answer Number: 4
Explanation: Laissez-Faire capitalism calls for the complete non-involvement of government in the economy. The approach is one of “hands-off”, in which prices, quality and competitive practices are solely determined by competition. This approach was advocated by the English economist Adam Smith in his work The Wealth of Nations and followed by the US government up until the late 1800’s, early 1900’s.
Gilded Age: Question 6 of 100
After the Civil War, one way business leaders tried to eliminate competition was by
  1. forming monopolies or trusts
  2. developing overseas markets
  3. increasing the prices of their products
  4. paying high wages to their workers
Correct Answer Number: 1
Explanation: A monopoly is a business that controls a vast majority or all of the market for a specific good or service. During the Gilded Age (late 1800’s) many areas of the US economy were dominated by monopolistic companies that drove competitions out of business. It was not until the Sherman Anti-Trust Act of 1890 that the government made any attempts to regulate or control the business practices of these monopolies.
Gilded Age: Question 7 of 100
In the United States, organized labor made its greatest membership gains when
  1. the right to unionize and bargain collectively was guaranteed by legislation
  2. international competition began to threaten jobs in the United States
  3. the major business groups encouraged unionization
  4. the economy began to shift from manufacturing to service employment
Correct Answer Number: 1
Explanation: Collective bargaining is the idea in which workers cooperate to achieve a common goal. In collective bargaining, representatives of the workers will negotiate with the management to secure gains for all workers, as opposed to the individual worker negotiating for him/herself. This concept greatly increased the power of workers to pressure for concessions and increased the power and prominence of the union movement.
Gilded Age: Question 8 of 100
Which factor most limited the growth of labor unions during the late 1800’s?
  1. Most employers were very hostile toward workers’ efforts to organize.
  2. Most factory workers were satisfied with their wages and working conditions.
  3. The Federal Government declared that unions were illegal.
  4. Workers preferred to negotiate with factory owners as individuals rather than as members of a group.
Correct Answer Number: 1
Explanation: Many industry owners felt threatened by the growth of unions in the late 1800’s. They rightly feared that union growth could force them into conceding higher wages, improved conditions and shorter work hours.
Gilded Age: Question 9 of 100
In the 19th century, the major national labor unions wanted to improve the position of workers mainly by
  1. obtaining the legal right to organize and bargain collectively
  2. using government troops to settle labor disputes with management
  3. supporting government ownership of major industries
  4. endorsing a third political party for workers only
Correct Answer Number: 1
Explanation: Collective bargaining is the idea in which workers cooperate to achieve a common goal. In collective bargaining, representatives of the workers will negotiate with the management to secure gains for all workers, as opposed to the individual worker negotiating for him/herself. This concept greatly increased the power of workers to pressure for concessions and increased the power and prominence of the union movement.
Gilded Age: Question 10 of 100
During the latter half of the 19th century, many business organizations in the United States combined into large corporations because
  1. income levels for workers would be improved
  2. government intervention in economic affairs would decline
  3. efficiency in production methods could be increased
  4. economic possibilities outside the United States could be explored
Correct Answer Number: 3
Explanation: The advantage of larger corporations over smaller ones becomes clear when considering the idea of “Economies of Scale”. The idea is a simple one, a larger corporation will make more of a given product and as a result buy more of the raw materials needed in production and negotiate a lower cost for those materials. The result is that a bigger corporation will be able to offer the same product at a lower overall cost to consumers, giving it the advantage in the marketplace against smaller competitors. Corporations such as Standard Oil used this advantage to lower prices and drive many smaller companies out of business.
Gilded Age: Question 11 of 100
Many reformers who opposed the laissez-faire attitude of the late 19th century argued that
  1. the National Government should not interfere in the activities of big business …big business
  2. national wealth could best be assured by the accumulation of gold
  3. the idea of rugged individualism is vital to the nation’s economic growth
  4. government should protect society through the regulation of business
Correct Answer Number: 4
Explanation: Many people during the Gilded Age were frustrated with business taking advantage of workers as well as the US consumers. There was a growing call in the late 1800’s for the government to step in and regulate the economy, insuring safety and fair prices. The best example of this can be seen in the Granger movement. The Grangers (farmers) called for the regulation of the railroad companies that were charging unfair rates and exercising monopoly power over transportation. The resulting government action was the passage of the Interstate Commerce Act and the creation of the Interstate Commerce Commission to regulate the railroads and their rates.
Gilded Age: Question 12 of 100
A major way in which the United States has practiced "economic nationalism" has been to
  1. implement protective tariffs to help American industry
  2. establish social welfare programs to aid the poor
  3. pass legislation outlawing most monopolies
  4. require industry to provide safe working conditions for employees
Correct Answer Number: 1
Explanation: Protective tariffs have been used throughout American history to protect US businesses from foreign competition. The idea is that by taxing imports the relative price of comparable US made goods will be cheaper, resulting in increased sales of US made goods which will aid US businesses. This approach was advocated earliest on by Alexander Hamilton as part of his 5 part economic plan to grow the fledgling US economy and protect US industry.
Gilded Age: Question 13 of 100
In the United States, industrial unions of the 1880’s and of the 1980’s had similar goals in that both campaigned for
  1. national health insurance
  2. better unemployment insurance
  3. greater job security and higher wages
  4. wage and price freezes
Correct Answer Number: 3
Explanation: In the 1880’s the main fear of American Unions was competition for jobs from floods of unskilled immigrants, in the 1980’s the fear was the relocation of manufacturing facilities from the US to Latin America and Asia where wages are a fraction of what US workers make.
Gilded Age: Question 14 of 100
In response to the demands of farmers and small business owners, Congress enacted laws in the late 19th century that
  1. supported the organization of farm cooperatives
  2. regulated the activities of railroads and trusts
  3. provided direct payments to farmers to help them buy modem machinery
  4. dropped tariff rates to the lowest point in the century
Correct Answer Number: 2
Explanation: Many people during the Gilded Age were frustrated with business taking advantage of workers as well as the US consumers. There was a growing call in the late 1800’s for the government to step in and regulate the economy, insuring safety and fair prices. The best example of this can be seen in the Granger movement. The Grangers (farmers) called for the regulation of the railroad companies that were charging unfair rates and exercising monopoly power over transportation. The resulting government action was the passage of the Interstate Commerce Act and the creation of the Interstate Commerce Commission to regulate the railroads and their rates.
Gilded Age: Question 15 of 100
A negative effect of holding companies, mergers, and pools on the United States during the late 19th century was that these combinations
  1. encouraged the Federal Government to spend more than its income
  2. reduced the need for labor unions
  3. decreased competition between businesses
  4. ended United States participation in inter-national trade
Correct Answer Number: 3
Explanation: A monopoly is a business that controls a vast majority or all of the market for a specific good or service. Holding companies and pools are various forms of this idea in which one larger company may own many of the smaller companies within an industry. During the Gilded Age (late 1800’s) many areas of the US economy were dominated by monopolistic companies that drove competitions out of business, thereby reducing competition. It was not until the Sherman Anti-Trust Act of 1890 that the government made any attempts to regulate or control the business practices of these monopolies.
Gilded Age: Question 16 of 100
Nativism in the late 19th century was motivated primarily by
  1. hostility toward immigrant workers
  2. the need to reduce overcrowding in western states
  3. cultural conflicts with Native American Indians
  4. the migration of African Americans to northern cities
Correct Answer Number: 1
Explanation: In the 1880’s a main fear of American unions was competition for jobs from floods of unskilled immigrants. Many unions took a “nativist” approach that called for the restriction of immigration. One such restriction was the Chinese Exclusion Act of 1888 which halted immigration of Chinese workers into the US.
Gilded Age: Question 17 of 100
During the late 1800’s, labor unions in the United States had their greatest success in
  1. persuading the government to limit most immigration
  2. organizing skilled workers into craft unions
  3. winning the great majority of strikes
  4. achieving a legally guaranteed minimum wage
Correct Answer Number: 2
Explanation: Craft unions such as the American Federation of Labor were successful at organizing skilled or craft workers. This was more successful due to the fact that skilled workers are more difficult to replace. Organizing unskilled workers proved much tougher, as companies could easily replace such workers with any number of newly arrived immigrants willing to work for the wages they offered.
Gilded Age: Question 18 of 100
The Sherman Antitrust Act, the Social Security Act, and the Federal Deposit Insurance Corporation (FDIC) are examples of
  1. Federal laws designed to protect consumers from unsafe products
  2. the Federal Government’s response to changes in the economy
  3. Federal laws designed to control spending
  4. the Federal Government’s attempts to regulate big business
Correct Answer Number: 2
Explanation: The Sherman Antitrust Act of 1890 banned “combinations in restraint of trade” or basically any monopoly that reduced competition in the marketplace, a direct response to the growth of monopolistic practices in the late 1800’s. Social Security was a response to the Great Depression and was designed to protect retiring workers, many of which were left with little to no retirement income. Finally FDIC was a response to the crisis in the US banking sector during the depression and was designed to insure depositors funds in case of a bank’s failure.
Gilded Age: Question 19 of 100
Which term best describes United States economic policy during the era of the rise of big business (1865-1900)?
  1. laissez-faire capitalism
  2. mercantilism
  3. Marxism
  4. welfare-state capitalism
Correct Answer Number: 1
Explanation: Laissez-Faire capitalism calls for the complete non-involvement of government in the economy. The approach is one of “hands-off”, in which prices, quality and competitive practices are solely determined by competition. This approach was advocated by the English economist Adam Smith in his work “The Wealth of Nations” and followed by the US government up until the late 1800’s, early 1900’s.
Gilded Age: Question 20 of 100
Which statement best describes the status of the labor union movement in the United States in 1900?
  1. Most of the labor force was organized into unions.
  2. Government and business opposition had destroyed the labor union movement.
  3. Unions were still struggling to gain public acceptance.
  4. Unions had won the right to strike and bargain collectively.
Correct Answer Number: 3
Explanation: One of the greatest blows to union growth during this time was the Haymarket Riot in Chicago in 1886. During a labor rally at which the Knight of Labor union was represented, a bomb exploded killing nearly 20 people. The American public unduly blamed the KOL and as a result public support for the union movement was reduced.
Gilded Age: Question 21 of 100
The purpose of the Interstate Commerce Act (1887), the Sherman Antitrust Act (1890), and the Clayton Antitrust Act (1914) was to
  1. eliminate unfair business practices
  2. reduce imports from foreign nations
  3. reduce the power of the unions
  4. increase the power of local governments
Correct Answer Number: 1
Explanation: Many people during the Gilded Age were frustrated with business taking advantage of workers as well as the US consumers. There was a growing call in the late 1800’s for the government to step in and regulate the economy, insuring safety and fair practices. The best examples of this can be seen in the ICC and the Sherman Antitrust Act. The passage of the Interstate Commerce Act and the creation of the Interstate Commerce Commission was designed to regulate the railroads and their rates. The Sherman Antitrust Act of 1890 banned “combinations in restraint of trade” or basically any monopoly that reduced competition in the marketplace, a direct response to the growth of monopolistic practices in the late 1800’s.
Gilded Age: Question 22 of 100
Why did the United States follow a policy of unrestricted immigration for Europeans during most of the 1800’s?
  1. Business and industry depended on the foreign capital brought by immigrants.
  2. The American economy needed many unskilled workers.
  3. Most Americans desired a more diversified culture.
  4. The United States wanted to help European nations by taking in their surplus pop-ulation.
Correct Answer Number: 2
Explanation: During the Gilded Age US industrial development was growing at an unprecedented rate. To fuel the increased demand for unskilled workers there was also an increase in immigration from southern and eastern Europe, Asia and elsewhere. These immigrants became known as “New Immigrants” as they were from different regions than the western European immigrants of “Old Immigration”.
Gilded Age: Question 23 of 100
Statement A: "The best way to economic recovery is to subsidize industry so that it will hire more workers and expand production."
Statement B: "If jobs are not available, the government must create jobs for those who are unemployed."
Statement C: "According to human nature, the most talented people will always come out on top."