Question

Which of these actions would be encouraged under a capitalist system but discouraged under a mercantilist system?

A.) Placing limits on the types of products sold in a country
B.) Selling expensive luxury goods to foreign consumers
C.) Importing cheap consumer goods from foreign countries
D.) Encouraging workers to move from farms to big cities

Answer 1

C.) importing cheap consumer goods from foreign countries

Answer 2

C) Importing cheap consumer goods from foreign countries.

Step-by-step explanation:

A capitalist system is one that is based on a laissez faire (aka hands off) government that allows individual producers and consumers to make their own economic decisions. This includes the freedom to buy, sell, and trade with whoever they want in order to benefit themselves.

The mercantilist system is an economic system based on an imbalance of power between a stronger country and a weaker country (or territory). In this relationship the stronger country (aka mother country) forces the weaker country to trade solely with them. This is why importing cheap consumer goods from foreign countries would be frowned upon.