Industrialisation and Big Business · US History

What was the significance of the holding company, which became popular after the crackdown on trusts?

  1. It was a non-profit organization designed to help the poor
  2. A company that existed solely to own other companies' stock, allowing centralized control
  3. It was a type of bank that only provided loans to small businesses
  4. It was a government agency that monitored railroad safety
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Correct answer: A company that existed solely to own other companies' stock, allowing centralized control

When states like New Jersey passed laws allowing companies to own stock in others, the holding company replaced the 'trust' as the preferred method for creating large industrial combinations.

Difficulty: Medium Question 18 of 20

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