The principle of the "invisible hand" claims that:
A)the selfish pursuits of everyone's own interest will lead to the best good for all under market competition.
B)government must gently guide economic activity so that the best for all will be attained.
C)government policies work like an invisible hand, steering resources to their best use.
D)producers must quietly cooperate so that prices are not so low as to cause losses.
E)none of the above.

Question

Quizplus · Accepted Answer

The principle of the "invisible hand" as proposed by economist Adam Smith states that individuals acting in their own self-interest in a free market will unintentionally benefit society as a whole. This is because in a competitive market, individuals will strive to produce goods and services that consumers want and need at a low cost, leading to an efficient allocation of resources and maximization of societal well-being.

The Principle of the "Invisible Hand" Claims That