Barter Economy : is a method of exchange by which goods or services are directly exchanged for other goods or services without using a medium of exchange, such as money.goods servicesmedium of exchangemoney Domestic System (Cottage system or Putting-Out system): New method of production in which manufacturing took place in workers’ homes. allowed many of the working class to earn a living outside of agriculture while remaining in the village where they lived. Usury: Charging of interest on loans. In places where interest became acceptable, usury was interest above the rate allowed by law. Capital : wealth that is earned, saved, and invested to produce profit. Market economy : an economy which land, labor, and capitol is controlled by individuals. economy based on the power of division of labor in which the prices of goods and services are determined in a free price system set by supply and demand.division of laborgoodsservicesfree price system supply and demand Chapter 11.2 Notes
Trade Revival in Europe The Italian cities-states; Venice, Genoa, and Pisa won trading rights in Constantinople, Syria, and North Africa. Crusade ships from Italian city-states carried crusaders to the Holy Lands & brought back rich cargos. Hanseatic League- 100 German cities such as Hamburg, Lubeck, and Bremen became powerful influence in commerce in Northern Europe. Flanders-meeting point for Belgium, France, & Netherlands via its connections to the Rhine River and English channel. Moved from a Barter economy to market economy. Fairs were a market to sale imported goods. Domestic system goods produced at workers’ homes. The Jews controlled most of the banking. Usury
Review Questions Section 2: Revival of Trade 1.Why did the growth of trade increase in the 11c? 2.Why did fairs arise, and how did they promote the exchange of goods? 3.What new system of manufacturing developed and how did it work? 4.Why did Jews control most of the money lending in the Middle Ages? 5.Describe “market economy” and what three developments occurred that laid the foundation for it? LocationReason for trade Revival Italy Northern Europe Flanders
1) Capital 2) Usury 3) Barter Economy 4) Domestic System 5) Market Economy Ch.11.2: ¼ sheet A) manufacturing took place in workers’ homes. B) land, labor, and capitol is controlled by individuals. C) Charging of interest on loans. D) investment to produce profit. E) exchanged for other goods or services without using a medium of exchange. medium of exchange
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