When Greenlawn Inc.finds itself losing contracts because Instillite Inc.charges less money,Greenlawn responds by lowering its bids.According to Adam Smith,this reaction demonstrates _____.
A)the invisible hand of competition
B)collision
C)the right to private property
D)social responsibility

Question

Quizplus · Accepted Answer

This reaction demonstrates the invisible hand of competition, which is an economic concept introduced by Adam Smith. According to this concept, the pursuit of self-interest by individuals and firms in a competitive market leads to the optimal allocation of resources and benefits for all. In this scenario, Greenlawn Inc. is responding to competition by lowering its bids, which is a natural response in a competitive market.