Question

Which of the following situations would not be supported by a government practicing a mercantilist economic system? A. The country's citizens support laws protecting domestic industries from foreign competition. B. The country's navy uses imported wood and steel to build its ships. C. The country's largest businesses successfully sell goods in foreign markets. D. The country's wealthiest citizens refuse to purchase luxury goods from other countries.

Answer 1

The correct answer is B) the country’s navy uses imported wood and steel to build its ships.

The situation that would not be supported by a government practicing a mercantilist economic system is “the country’s navy uses imported wood and steel to build its ships.”

The mercantilist economic system accepts and supports government intervention to regulate the economy of a country, making the State the generator and supervisor of the economic policies at the expense of other nations. It was the type of economic system used in Western Europe from the 16th to the 18th century. That is the reason why the situation that would not be supported by a government practicing a mercantilist economic system is the country’s navy uses imported wood and steel to build its ships.

Answer 2

The correct answer is "B"

Mercantilism is an economic system that is based on the development of trade and export. His doctrines were developed between the sixteenth and eighteenth centuries in Europe.

For the establishment of mercantilism, a strong state was required that could take the necessary measures to regulate the economy. It was considered that the prosperity of each nation was linked by the capital accumulated by it, which in turn was represented by the accumulation of precious metals held by the State.

Mercantilist theorists argued that such capital could increase from a positive trade balance, that is, with a level of exports that exceeds the level of imports. This translated into a government that had to implement protectionist policies, protecting domestic production with import tariffs and favoring exports.