Question

Determine whether each statement best describes capitalism or mercantilism.

It is an economic
system that relies
on a free market.
The government is
in control of the
nation’s economy.
It requires a nation
to export goods
worth more than the
goods it imports.
The government
doesn’t get
involved with the
economy.

Answer 1

Capitalism- 1,4 Mercantilism- 2,3

Answer 2

The correct answer is the following.

The correct matches are:

It is an economic system that relies on a free market: Capitalism.

The government is in control of the nation’s economy: Mercantilism.

In requires a nation to export goods worth more than goods is imports: Mercantilism.

The government doesn’t get involved in the economy: Capitalism.

Mercantilism was the economic system used from the 16th to the 18th century. Europeans governments accumulated as much wealth as they could because they considered that wealth has a limit. The government imposed economic regulations in its producti activities. Capitalism is the economic system that supports companies doing business to generate earnings and promote the economy of a nation. Capitalism believes in free trade and the non-intervention of the government.