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Difficulty: MediumDevelopment of Industrial Capitalism and Transnational Businesses

"Our work here is not merely the extraction of diamonds from the soil of South Africa; it is the establishment of a systematic control over the global trade in precious stones. By consolidating our holdings and establishing sales agencies in London, Paris, and Amsterdam, we can regulate the supply to match the demands of the global market, ensuring steady profits for our investors and securing the capital necessary for further infrastructure development across the continent."

—Address delivered by the chairman of the De Beers Consolidated Mines at a shareholders' meeting in Kimberley, South Africa, 1889

The operations of companies like De Beers as described in the passage best illustrate which of the following developments in the nineteenth century?

  1. The rise of transnational businesses that organized extraction and marketing across national boundaries to maximize profitsAnswer
  2. B
    The persistence of mercantilist economic goals that restricted corporate ownership to state-sponsored monopolies
  3. C
    The requirement of direct political administration and territorial annexation by Western states to conduct global trade
  4. D
    The reliance of early industrial ventures on the steam-powered technologies characteristic of the First Industrial Revolution

Answer

The rise of transnational businesses that organized extraction and marketing across national boundaries to maximize profits
The correct answer is correct because the address from the chairman of De Beers illustrates a private corporation that integrates resource extraction in South Africa with commercial sales agencies in major European capitals. This pattern of global integration is the hallmark of transnational businesses that developed during the nineteenth century under industrial capitalism to maximize corporate profits and secure funding for infrastructure.

Step-by-Step Solution

1
Analyze the provided historical stimulus.
The passage describes De Beers Consolidated Mines consolidating holdings, coordinating extraction in South Africa, and setting up sales agencies in London, Paris, and Amsterdam to regulate global trade and ensure profits for private investors.
This establishes the historical context of a privately-owned corporation operating across multiple continents and integrating extraction with global marketing.
2
Evaluate the core concepts of the AP World History curriculum for Unit 5.
The relevant development is the rise of industrial capitalism and transnational businesses (such as De Beers, HSBC, or the United Fruit Company) that operated across national borders to control resources and markets.
This allows the identification of the matching historical trend.
3
Verify and select the correct option while eliminating distractors.
The correct option is the one describing the rise of transnational businesses. Distractors conflating mercantilism, direct colonial administration, or early industrial technologies are eliminated.
This ensures the final answer is historically accurate and directly supported by the text.

Key Concept

Development of Industrial Capitalism and Transnational Businesses
Estimated Time:1m 30s
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Topics

Development of Industrial Capitalism and Transnational Businesses

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