📚 Learning Guide
Sherman Antitrust Act
easy

What was the primary effect of the Sherman Antitrust Act in the marketplace during the late 19th century?

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Choose the Best Answer

A

It reduced government intervention and allowed monopolies to thrive.

B

It promoted competition by curbing monopolistic practices.

C

It increased the number of trusts and monopolies in the economy.

D

It had no significant impact on market competition.

Understanding the Answer

Let's break down why this is correct

Answer

The Sherman Antitrust Act was passed to stop companies from forming monopolies that hurt competition. It made it illegal for firms to combine or fix prices to control the market. The law forced big companies to break up or change their practices, which let more businesses compete. For example, a railroad company that tried to charge all customers the same high price was forced to lower prices or split into smaller lines. Overall, the Act opened the market, made prices fairer, and encouraged new businesses to enter.

Detailed Explanation

The law made it illegal for companies to form trusts that controlled too many markets. Other options are incorrect because Many think the law gave the government less power, but it actually gave the government the power to break up big companies; The law was aimed at reducing trusts, not making them bigger.

Key Concepts

Antitrust legislation
Monopoly and competition
Government intervention in the economy
Topic

Sherman Antitrust Act

Difficulty

easy level question

Cognitive Level

understand

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