Custom taxonomy term page with posts

Hi all…
I have wordpress site with registered custom post type and assigned custom taxonomy. I have thousands of posts in database and each of them has one assigned custom taxonomy term.

What I want to do is to show custom taxonomy term page on which users will be able to see all posts assigned to that term. So the link to the term should be:
http://www.mysite.com/my-custom-post-type/term-name

So if the custom post type is “Country”, custom taxonomy “City” and one of terms is “London”, it should be http://www.mysite.com/country/london.
Am I right?

When I navigate to that kind of link, it shows me 404 not found error page. I’ve been searching whole internet past few days and trying to find the solution, I saw many similar threads but none of them actually helped…

Does anybody have any idea how can I list all posts assigned to specific term on term page? I’m gonna buy you a beer if you help me… 🙂