Question

Carnegie was afraid that J.P. Morgan would next try to take over Carnegie Steel. What action did Carnegie take?

a) He sold Carnegie Steel to a competitor.
b) He initiated a hostile takeover of J.P. Morgan's businesses.
c) He formed a partnership with J.P. Morgan.
d) He entered into a joint venture with Rockefeller.

Answer 1

The correct answer is option a) He sold Carnegie Steel to a competitor.

Step-by-step explanation:

Faced with the prospect that J.P. Morgan might attempt to take control of Carnegie Steel, Andrew Carnegie chose to preempt any such moves. The action that Carnegie took was not to engage in hostilities, partnerships, or joint ventures, but rather to sell his company outright.

Ultimately, Carnegie decided to sell Carnegie Steel to J.P. Morgan, who consequently turned it into the foundation of the U.S. Steel Corporation, which was the first billion-dollar company and the largest corporation in the world at the time. The sale of Carnegie Steel happened in 1901, after Morgan presented Carnegie with an offer of $500 million - an offer that Carnegie could not refuse.