Final answer:
The statement is false. The growth of large cities and the factory system occurred during the Industrial Era, not the colonial era.
Step-by-step explanation:
The statement that the colonial era was characterized by a factory system and the growth of large cities is false.
The development and growth of large cities and the factory system took place during the Industrial Era, which occurred in the United States from the mid-19th century onwards.
During the colonial era, factories were limited and concentrated near rivers and seaports due to the need for transportation and water power. The shift towards urbanization and the establishment of factories in cities occurred much later with the market revolution and the Industrial Revolution.