Question

During the Gilded Age, business leaders pushed to force out of business or buy out

competitors within their industries, Gaining a majority control of an industry proved
to be very profitable for tycoons because they were able to set prices for the goods
and services they provided. Collections of businesses owned by the same person or
group of people became known as trusts. A business that controls an entire industry
is known as a monopoly. Why might a monopoly or a trust in a certain industry be
bad for both consumers and workers?

Answer 1

A good answer should contain the following:

Possible Answers:

• Skilled workers in such an industry have to work for the trust/monopoly or not work in their skill set. This gives the employer much leverage in pay/benefit negotiations.

• Since consumers have no choice but to buy from the trust/monopoly they have to pay (usually) higher prices than they would if there were competition between businesses owned by different people.

• Without competition there might be little incentive to improve product quality and to develop new products.

Answer 2

A monopoly establishes a market without competition, which does not allow the consumer to have product and price options and is obliged to buy the product at the price that the monopoly wants. The lack of competitors also contributed to the product being sold at high prices and that there is no pursuit of increasing the quality of this product.

In relation to workers, as the monopoly dominates an entire market sector, it means that professionals in that sector are limited to a single company, which can result in lower wages, few benefits and poor working conditions.