The Difference Between Mercantilism and Feudalism Is That Under Mercantilism

question 18

Multiple Choice

The difference between mercantilism and feudalism is that under mercantilism:

• A) merchants played a more important political role than kings.
• B) the invisible hand played a more important role than the government.
• C) nation-states ruled by kings who coordinated the economic activity emerged.
• D) economic rather than social and political forces made the central economic decisions.

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Definitions:

Unlimited Liability

A legal structure in which the owners are personally liable for all the debts and liabilities of the business, without any limit.

General Partnership

A business arrangement where two or more individuals agree to share in all assets, profits, and financial and legal liabilities of a jointly-owned business.

Corporation

A legal entity created by individuals, stockholders, or shareholders, with the purpose of operating for profit. Corporations can enter contracts, sue and be sued, and pay taxes apart from their owners.

Secondary Market

The marketplace where investors buy and sell securities they already own, as opposed to the primary market where securities are first issued.