Which was the immediate goal of the Standard Oil Company when it lowered its prices?
a. to sell stock to investors
b. to outcompete rival businesses
c. to form a monopoly
d. to pass on lower costs to customers
d. to pass on lower costs to customers
The immediate goal of the Standard Oil Company when it lowered its prices was to outcompete rival businesses (option b). To understand this, let me explain the context of the situation and how you can arrive at the answer.
Standard Oil Company, founded by John D. Rockefeller in 1870, was one of the most influential companies in the oil industry during the late 19th and early 20th centuries. Rockefeller aimed to dominate the oil market and sought to eliminate competition to establish a monopoly. Lowering prices was one of the strategies employed by Standard Oil to achieve its ultimate goal of forming a monopoly (option c).
By lowering prices, Standard Oil could attract more customers, gain a larger market share, and undercut its competitors. This aggressive pricing strategy would force rival businesses to either match the lower prices or risk losing customers to Standard Oil. With this approach, Standard Oil aimed to weaken and eventually drive its competitors out of the market (option b).
It is important to note that while Standard Oil lowered its prices, passing on lower costs to customers (option d) was not its immediate goal. Instead, Standard Oil intended to use aggressive pricing as a means to gain control over the industry and establish monopolistic control.
In summary, the immediate goal of the Standard Oil Company when it lowered its prices was to outcompete rival businesses (option b) and dominate the oil market.