MERCANTILISM

MERCHANTILISM

An economic and political system where countries gain wealth and power by limiting imports and increasing exports. *Trade controlled by Mother Country

BULLION

By establishing that favorable balance of trade, nations would build up their supply of gold (bullion) and gain more power for the mother countries of Europe.

How does mercantilism benefit the Mother Country?

Colonies supply raw materials at a discounted price to the Mother Country. The Europeans would then make those raw materials into finished products and then sell those finished products back to the colonies for a higher price. Mother countries further controlled trade by only allowing their colony to trade with their mother country and by placing a tariff on goods imported from other nations.

What was the role of the Colony

Colonies were an important part of mercantilism because they allowed Mother countries to have that favorable balance.

MERCHANT

Someone who sells goods for profit

COLONY

The land and people that a mother country rules and controls and gets raw materials

FEUDAL SYSTEM

Where only land ownership provided income.

IMPORTS

You bring in goods and services

EXPORT

You send out goods and services

What was the goal of Mercantilism?

1. Under this system, governments wanted to control and regulate trade in the new lands. 2. Their end goal was to have favorable balance of trade where they exported more than they imported