Question

The system of mercantilism is based on which concept?

A. Nations increase their wealth by promoting the development of
agricultural trade.

B. Nations increase their wealth by producing an abundance of raw
materials.

C. Nations increase their wealth by exporting more than they import.

D. Nations increase their wealth by establishing trade agreements
with other nations.

Answer 1

ANSWER:

The system of mercantilism is based on "Nations increase their wealth by exporting more than they import".

Option: (C)

EXPLANATION:

• Adam Smith instituted the term "mercantile system" to relate the 'system of political economy' that looked to advance the nation by limiting imports and empowering exports.

• This system influenced Western European economic policies and approaches from the '16th' to the late '18th' century.

• The objective of these policies was, as far as anyone knows, to accomplish an "ideal" balance of trade that would bring silver and gold into the nation and increase their wealth and economy.