The critical assumptions behind the idea of Adam Smith's invisible hand are
A)wage-price flexibility and individuals pursuing their own self-interests.
B)balanced budget and balance trade.
C)zero unemployment and high economic growth.
D)high economic growth and low inflation.

Question

Quizplus · Accepted Answer

The invisible hand theory is based on the idea that wage and price flexibility allows for market forces to efficiently allocate resources, and individuals pursuing their own self-interests leads to an overall positive outcome for society as a whole.

The Critical Assumptions Behind the Idea of Adam Smith's Invisible