When Private Jets,Inc.finds itself losing contracts because Global Aviation,Inc.charges less money,Private Jets responds by lowering its bids.According to Adam Smith,this reaction demonstrates _____.
A)the invisible hand of competition
B)collision
C)the right to private property
D)social responsibility

Question

Quizplus · Accepted Answer

Adam Smith's concept of the "invisible hand" refers to the self-regulating nature of the marketplace, where competition among businesses naturally leads to the efficient allocation of resources. In this scenario, Private Jets, Inc. lowering its bids in response to competition from Global Aviation, Inc. exemplifies how competition drives companies to adjust their strategies for the benefit of consumers, aligning with the principle of the invisible hand.