Question

All of the following were mercantilistic policies pursued by governments except:

A) Forbidding imports of luxury goods because their purchase drained gold and silver away from the mother country
B) Encouraging high wages to increase national purchasing power
C) Founding colonies to create markets for national products
D) Enacting laws to insure favorable balances of trade

Answer 1

Answer: Encouraging high wages to increase national purchasing power.

Explanation: Mercantilism is the theory that a nation must always have a positive balance of trade, in the manner that a merchant would operate a shop. Typically this model presupposes protectionism.

It is aimed at accumulating monetary reserves through a positive balance of trade, especially of finished goods.

Encouraging high wages to increase national purchasing power is not a good mercantilistic practice because it is not aimed at accumulating monetary reserves through a positive balance of trade.

Answer 2

The correct answer is letter B

Mercantilism was the set of economic practices adopted by European nations between the 15th and 18th centuries. These economic practices are considered by historians as the stage of transition from the feudal mode of production to the mode of capitalist production. In this sense, it is incorrect to say that mercantilism was an economic system, since it did not consist of a mode of production, such as feudalism and capitalism.

It was adopted by European nations during the Great Navigations and the establishment of the colonial system on the American continent. It is important to consider that mercantilism adopted different characteristics according to the reality and the needs of each European country.