2. Textiles $ 300 Lumber $ 500 Gold $ 200 England Exports textiles England Imports Lumber Does the money England receives from France for its Export of Textiles equal the cost of the Lumber they import from France? What is the result of the imbalance in trade? What does England have to give to France to purchase Lumber?

5. Definition: When a country like Britain (England) used its colonies to form a favorable balance of trade.

6. Textiles $ 300 Lumber Gold $ 300 Lumber Britain (England) can use the colonies to get the lumber they used to have to get from France England no longer needs French Lumber France still needs to import textiles from England. France now has to pay Britain to get the textiles it needs

7. Goal of Mercantilism: A country like England wants to create a favorable balance of trade. Colonies helped countries achieve this goal. – Example 1 England had a trade deficit » Imports cost more than exports = debt – Example 2 England used its colonies to get the goods it once imported, but it still exported its textiles » Exports exceeded the cost of imports = profit