The invisible hand principle, as developed by Adam Smith in The Wealth of Nations, states that
A) government control over economic activity is essential for the talents of individuals to be directed toward their highest valued use.
B) the economic wealth of a nation is determined by a nation's holdings of precious metals, such as gold and silver.
C) public policy should prohibit domestic producers from selling their goods to foreigners.
D) competitive markets will bring individual self-interest and the public interest into harmony.

Question

Quizplus · Accepted Answer

The invisible hand principle, developed by Adam Smith, states that individuals pursuing their own self-interest in competitive markets will ultimately generate outcomes that benefit society as a whole. This occurs because the competitive market forces producers to allocate resources efficiently and utilize technologies that drive down prices for consumers. In this way, the invisible hand of the marketplace brings the interests of the individual and the public into alignment, without requiring government intervention.

The Invisible Hand Principle, as Developed by Adam Smith in the Wealth