Question

True or false and WHY? The theory economic development/wealth of the Mercantilists is superior to that of Cantillon or Smith. 2) True or false and WHY? Adam Smith's value theory is useful in resolving the paradox of value.

Answer 1

answer 1. False.

Adam Smith’s theory,who is the father of modern economics is anyday better than the Mercantilism theory of economic development.

He in his book "The Wealth of Nations" argued that free trade enables businesses to specialize in the production of the goods that they manufacture most efficiently.

In a free trade system, individuals benefit from a greater choice of goods for purchase at affordable prices. Mercantilism restricts imports, which reduces the choices available to consumers in the marketplace. Fewer imports mean less competition, and therefore, higher prices.