Trusts and Monopolies

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A trust is when a group of competing corporations work together with a common group of leaders called the board of trustees and all of the money the trust makes is split between all companies in the trust.   

Example: Babysitters Club

An example of a trust is shown in the book The Babysitters Club.  In this book a group of young girls, who previously worked as individual babysitters joined together to form the Babysitters Club. In this club, they all did what they had done previously alone, but did it together.  This club allowed them to share the profits and not compete for a job.  If the club is like a trust, each girl is like a corporation inside the trust.

This image represents a trust because it shows how individuals, which represent corporations, are working together towards a common goal under the same leadership.

A monopoly is when a company dominates an industry to the point where they become the sole producer or provider of services in their industry.  When a company has a monopoly it is able to offer goods for lower quality and higher prices.

Example: American Eagle

American Eagle is one of many different clothing stores available to people today.  If American Eagle were to buy all of its competitors (Hollister, Aeropostale, Abercrombie, etc.) or run their competitors out of business it would become a monopoly.  This would not be possible today because government regulation prohibits it, which supporters of laissez - faire were fearful of. 

This picture relates to a monopoly because Bill Gates represents the monopoly man because he used to have a monopoly through Microsoft.

By: Mackenzie Martin, James Schormm and Amanda Vecchiarelli

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