The invisible hand concept suggests that
A) market failures imply the need for a national economic plan.
B) big businesses are inherently more eﬃcient than small businesses.
C) the competitiveness of a capitalistic market economy invariably diminishes over time.
D) assuming competition, private and public interests will coincide.

Question

Quizplus · Accepted Answer

The invisible hand concept suggests that assuming there is competition, private interests and public interests will coincide, meaning that the pursuit of self-interest by individuals and firms in a market economy will lead to outcomes that benefit society as a whole. It does not imply the need for a national economic plan, that big businesses are inherently more efficient than small businesses, or that the competitiveness of a capitalistic market economy invariably diminishes over time.

The Invisible Hand Concept Suggests That