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Difficulty: MediumAdvances in Technology and Exchange

Before the container revolution of the mid-twentieth century, cargo was loaded in a process called 'breakbulk shipping,' where dockworkers loaded individual crates, barrels, and sacks by hand. This labor-intensive method meant that ships spent up to two-thirds of their time idle in ports, and shipping costs accounted for a substantial portion of the retail price of manufactured goods. The standardized cargo container, introduced in 1956, allowed goods to be loaded onto trucks at a factory, moved directly to railcars, and stacked onto specialized ships without ever being handled by dockworkers. By reducing transit times and cargo handling costs by over 90%, the container transformed global commerce.

Which of the following best explains how the technological development described in the passage affected the global economy in the late twentieth century?

  1. A
    It prompted states to return to mercantilist policies to protect domestic markets from foreign competition.
  2. It allowed multinational corporations to establish global supply chains by outsourcing manufacturing to developing nations.Answer
  3. C
    It led to the complete homogenization of global consumer culture and local traditions.
  4. D
    It initiated the primary transition from coal-powered steam transport to petroleum-fueled engines.

Answer

The standardized shipping container allowed multinational corporations to establish global supply chains by outsourcing manufacturing to developing nations.
The correct option is correct because the dramatic reduction in shipping costs and port turnaround times facilitated by standardized containers made it economically viable for companies to build global supply chains. Multinational corporations could outsource manufacturing to developing countries where labor costs were lower and then ship the finished products affordably to consumers worldwide.

Step-by-Step Solution

1
Analyze the stimulus to identify the technological development and its direct effects.
The text describes the introduction of standardized shipping containers, which reduced shipping transit times and handling costs by over 90%.
This establishes the factual basis of the question before analyzing broader economic impacts.
2
Connect the reduction in shipping costs to late twentieth-century global economic trends.
Lower transport costs made the distance between production and consumption less economically significant.
This link explains why manufacturing could be relocated overseas without shipping costs absorbing the savings.
3
Select the option that reflects the resulting shift in manufacturing and supply chain organization.
Multinational corporations took advantage of low shipping costs to establish global supply chains, outsourcing labor-intensive manufacturing to developing economies.
This choice directly aligns with the historical effects of Unit 9 transport innovations.

Key Concept

Advances in transportation, such as containerization, facilitated the growth of global supply chains and economic globalization in the late twentieth century.
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