Mercantilism and Capitalism

Economists

European economic thinkers

Bullion

Gold and Silver

Merchants

businessmen who became wealthy due to increased trade/ become the "new" middle class

Entrepreneurs

businessmen willing to risk money in hopes of earning a profit

Favorable Balance of Trade

countries want to export more than they import

Mother Country

country of origin of settlers or colonists/ European country: England, France, Spain, Portugal, and the Netherlands

Profits

difference between the amount earned and the amount spent

Mercantilism

economic policy where Mother Countries wanted to increase their wealth and power by obtaining large amounts of gold and silver (bullion) and by selling more goods than they bought

Capitalism

economic system based on private ownership, free trade, private property, little to no government interference

Free Enterprise

freedom of private businesses to compete for profits without government involvement

Markets

place for people to buy or sell

Feudalism

political system in which nobles are granted the use of lands that legally belong to their king, in exchange for their loyalty, military service, and protection of the people who live on the land/ no international trade/ manors were self-sufficient

Market Economy

prices of goods are controlled by supply and demand

Finished Products

products that have been made into something by using natural resources/raw materials

Raw Materials/Natural Resources

resources used to make goods

Middle Class

social class made up of skilled workers, professionals, business people, and wealthy farmers

Economics

study of how societies decide what to produce, how to produce it, and how to distribute what they produce/how a country deals with money

Tariff

tax on imports

International Trade

the exchange of capital (money) and goods over borders

Imports

what a country buys

Exports

what a country sells