The idea that business failure is a positive force for progress in a market economy is often summarized by the term "creative destruction." Which of the following best states the central idea of this principle?

Question

Quizplus · Accepted Answer

The central idea of creative destruction is that the failure of businesses allows resources and assets to move into areas where they are more productive and valuable. This process ultimately leads to progress and innovation in a market economy. Option A is incorrect because government subsidies are not a positive outcome of business failure. Option C is incorrect because income concentration is not the central idea of creative destruction. Option D is incorrect because it suggests that new businesses are less efficient and less creative, which is not the case.

The Idea That Business Failure Is a Positive Force for Progress