Final answer:
John D. Rockefeller's Standard Oil practice was vertical integration, which involved controlling every stage of the oil production process. This approach was coupled with horizontal integration, expanding through mergers and reducing competition. Ultimately, these practices faced legal challenges under anti-trust laws.
Step-by-step explanation:
The business practice exemplified by John D. Rockefeller through his company Standard Oil is known as vertical integration. Rockefeller's approach was to control every aspect of the oil production process. By owning the entire supply chain, from the extraction and transportation to the refining and selling of oil products like lubricating oil and gasoline, he eliminated reliance on external suppliers and transportation services. This allowed Standard Oil to lower costs and dominate the market. Such control over the entire process also enabled Rockefeller to partake in horizontal integration, which involves the consolidation or merger of many companies in the same industry, thereby reducing competition and leading to monopoly power. Standard Oil's expansion included the absorption of competing refineries and the creation of trusts, a form of business organization that led to large-scale mergers and control over various smaller companies, strengthening Standard Oil's market dominance.
However, such monopolistic practices eventually led to anti-trust legal challenges. The Sherman Anti-Trust Act targeted such practices with the aim to maintain competition and prevent the creation of monopolies or trusts that stifled competition and controlled markets.