AP Modern World History Flashcards: Economic Developments and Innovations
Written by AP Content Team, Verified for 2026 AP Exams, Last updated: May 2026
Review key ideas with interactive flashcards. This set includes 10 cards to help you master important concepts.
What new practices in banking and finance supported the proliferation of transnational businesses?
The growth of transnational businesses relied on new financial practices such as stock markets and the formation of limited-liability corporations.
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What new practices in banking and finance supported the proliferation of transnational businesses?
The growth of transnational businesses relied on new financial practices such as stock markets and the formation of limited-liability corporations.
How did improved manufacturing methods under industrial capitalism affect consumers?
These methods increased the availability, affordability, and variety of consumer goods for the public.
What major economic shift occurred in Western European countries between 1750 and 1900?
Western European countries began abandoning mercantilism and adopting free trade policies, influenced by Adam Smith's theories.
What factors contributed to the proliferation of large-scale transnational businesses?
The global nature of trade and production, along with new practices in banking and finance like stock markets, contributed to their growth.
What is laissez-faire capitalism?
It is an economic theory, promoted by Adam Smith, that advocates for free markets with minimal government interference.
What was the relationship between Adam Smith’s theories and the shift away from mercantilism?
The growing acceptance of Adam Smith’s theories of laissez-faire capitalism and free markets was a key reason why Western European countries began abandoning mercantilism.
What are limited-liability corporations?
Limited-liability corporations are a business structure and a new practice in finance that became important for large-scale businesses during this period.
What is a transnational business?
A transnational business is a large-scale company that operates across national boundaries, contributing to the global nature of trade and production.
What were two primary effects of the development of industrial capitalism on society?
Industrial capitalism led to increased standards of living for some people and an increased availability, affordability, and variety of consumer goods.
Provide an example of a large-scale transnational business that emerged in the period from 1750-1900.
Examples include the Hong Kong and Shanghai Banking Corporation (HSBC) and Unilever.