(A) Why Did the Mercantilists Think That a Situation

question 24

Essay

(a) Why did the Mercantilists think that a situation where a country’s exports exceed its
imports is a “favorable” situation for the country? Briefly, what policies would a Mercantilist recommend in order to generate such a “favorable” situation?

(b) What was the “price-specie-flow doctrine” and how did it undermine Mercantilist thinking? Why would a situation where the demands for traded goods are “inelastic” with respect to price changes pose a problem for the “price-specie-flow doctrine” in its attack on Mercantilist thinking?

---

Definitions:

Anticodon

Three-base sequence in a transfer RNA molecule base that pairs with a complementary codon in mRNA.

Transfer RNA

An adaptor molecule in protein synthesis that carries a specific amino acid to the ribosome, where its anticodon pairs with the corresponding codon on mRNA.

Ribosomal RNA

A type of RNA which, along with proteins, forms the structure of ribosomes and plays a role in the translation of mRNA into proteins.

DNA Molecule

The carrier of genetic information in living organisms and viruses, composed of two long strands forming a double helix.