Exercises And Problems. Organization Of Industry

Description

This section is from the book "Elementary Economics", by Charles Manfred Thompson. Also available from Amazon: Elementary Economics.

Exercises And Problems. Organization Of Industry

A

1. What was the essential difference between the English Industrial Revolution and the American Industrial Revolution?

2. What does an "industrial revolution" mean?

3. Is there likely to be another industrial revolution? Why, or why not ?

4. Name three important changes in agriculture during the past half century.

5. How did the tariff act of 1816 differ from preceding tariff acts?

6. What is meant by the expression "domestic manufactures"? "factory system " ?

7. What are the disadvantages of a partnership?

8. Why did the corporative form of business organization develop ?

9. What are the chief merits of this form ?

10. What is a "corporation charter"?

11. Where and how is it usually obtained?

12. Distinguish between stocks and bonds.

13. Why are most farms operated by single enterprisers?

B

1. Make lists of single enterprisers, partnerships, and corporations in your neighborhood.

a. In which list are found the concerns that employ the largest capital ?

b. What kinds of business, in general, characterize each of these lists ?

2. Get, if possible, a partnership agreement from some business man.

a. How much money did each partner invest ?

b. What specific duties are required of each partner ?

c. How may the partnership be voluntarily dissolved?

3. Write up what you would consider a good partnership agreement for three men about to engage in the grocery business.

4. Examine a stock certificate, and notice the following facts: a. Name of owner.

b. Number of shares.

c. Par value of each share.

d. Common or preferred.

5. Study a stock report, to be found in any metropolitan newspaper.

a. Notice the wide variation in the prices of stocks.

b. Why do not bonds vary so widely?

c. Compare price of common stock and price of preferred stock of the same concern.

d. Which is subject to wider fluctuations ? Why ?

C

1. Comment on the following statement: "The enactment of corporation laws by the various states is the most important step in the development of American manufactures made during the past century."

2. "A corporation is nothing more than a person without a soul." a. Explain the general attitude of corporations toward society.

b. Why do many persons think it permissible to cheat a corporation ?

c. Can a corporation die ? Explain.

3. A corporation with a capital of $50,000, having outstanding four per cent bonds with a par value of $50,000, earns $5000 annually.

a. How will these earnings be divided ?

b. What will be the dividend rate: i. If all the stock is common? ii. If all the stock is preferred ? iii. If one-half of the stock is eight per cent preferred?

c. What would be a fair market price of stocks under each condition ?

4. Suppose a' corporation with a capital of $100,000, having outstanding five per cent bonds with a par value of $50,000, should fail. How would settlement be made if the total assets sold for $45,000? for $55,000? for $75,000? for $100,000? How, if a partnership ?