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Why did prices work against the American farmer between 1870 and 1890?
AHe sold behind a tariff but bought on world terms
BHe sold and bought entirely inside one state
CHe sold only to the railroads that carried grain
DHe sold on world terms but bought behind a tariff
Answer & Solution
Correct answer: D. He sold on world terms but bought behind a tariff
1. 1. His selling market is described as a competitive world market, so the price of wheat, cotton or beef was set abroad.
2. 2. His buying market is described as protected against competition.
3. 3. The price of his harvester, fertilizer and barbed wire was therefore fixed by trusts behind a protective tariff.
4. 4. Competition on one side and protection on the other squeezed him from both directions.
5. 5. Reversing the two sides, as the first option does, would have worked in his favour instead.
6. 6. Buying and selling inside one state contradicts a price determined abroad.
_Source: An Outline of American History (U.S. Information Agency, 1990, public domain), section FARMERS FACE HARDSHIPS_
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