According to Adam Smith
A)government intervention in markets is not desirable because an invisible hand leads decisions made in pursuit of self-interest to unintentionally promote the social interest.
B)in a market transaction buyers can either get what they want for less than they would be willing to pay or sellers can make a profit,but both buyers and sellers can't gain simultaneously.
C)politicians are well-equipped to regulate corporations and intervene in markets to improve market outcomes.
D)when big corporations pursue their self-interest of maximum profit,they will inevitably conflict with social interest.
E)the self-interest and the social interest never conflict.

Question

Quizplus · Accepted Answer

Adam Smith argued that government intervention in markets is not desirable because the invisible hand of market forces will lead decisions made in pursuit of self-interest to unintentionally promote the social interest. This means that while individuals and firms are acting in their own self-interest, they are also indirectly benefiting society as a whole by providing goods and services efficiently and at lower prices. Therefore, government should only intervene in markets to correct market failure, such as when there are externalities or monopolies present.