Which core business activity enabled Standard Oil to become a horizontally integrated monopoly?

• A. Managing railroad transportation for oil products
• B. Developing new oil exploration technologies
• C. Owning oil extraction and drilling sites
• D. Controlling oil refining operations across multiple locations

Answer: (D)

Verified step by step guidance

1. Understand the concept of horizontal integration: it involves a company expanding its control over the same stage of production or business activity across multiple locations or firms.
2. Identify the core business activities listed and classify them as either upstream (like oil extraction and drilling), downstream (like managing transportation), or midstream (like refining).
3. Recognize that Standard Oil's horizontal integration focused on controlling oil refining operations, which means owning and managing multiple refineries rather than just one location.
4. Analyze how controlling multiple refining operations allowed Standard Oil to reduce competition, achieve economies of scale, and dominate the refining market.
5. Conclude that the key activity enabling Standard Oil's horizontal monopoly was controlling oil refining operations across multiple locations, as this fits the definition of horizontal integration.