Describe the characteristics of mercantilism and how they affected the development of the colonies?

The balance of trade was of great importance to successful mercantilism. The colonies provided Britain with raw goods, and Britain used the raw goods sold in the European market to sell back to the colonies. Mercantilism focused on controlling gold in order colonists to pay for its large armies and expand its empire. The more the colonies export, the more wealth and power Britain has.

Explanation:

when a country suffers, for example, a drought period, the market product is affected for a low offer, in this case, potatoes; the government has to tax to the households, which have to give more money for the potatoes which they consume, that situation make them consume substitute goods even through loans, it could increase the financial market movement and the inflationary phenomena, the business has to increase salaries in order to the employees could buy a more expensive food (potatoes) and in order to inflation tha business had to buy expensive supplies in the factor market, while the rest of the world have to gain more money to consume the same amount of potatoes.