What Was One of the Advantages of the "American System

question 62

Multiple Choice

What was one of the advantages of the "American system" of manufacturing?

• A) Inventors would have more time to develop their inventions slowly.
• B) Manufacturers would have a convenient way of excluding outside investors.
• C) Foreigners would have no way of copying American machines.
• D) Damaged parts could be replaced easily.
• E) American craftsmen could demonstrate their skills to the British.

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Definitions:

Cost Method

A method of accounting where the investment is recorded at its acquisition cost, without subsequent change to market value.

Equity Method

An accounting technique used for recording investments in associate companies where the investment is initially recorded at cost and adjusted thereafter for the post-acquisition change in the investor's share of net assets of the investee.

Stock Investments-Long

Investments in stock securities intended to be held for a long-term period for capital appreciation, dividend income, or both.

Common Stock

Equity securities representing ownership in a company, entitling holders to vote and share in the company's profits.