The self-interest of the participants in an economy is guided into promoting general economic self-interest by
A)the invisible hand.
B)market power.
C)government intervention.
D)oikonomos.

Question

Quizplus · Accepted Answer

The concept of the "invisible hand" was introduced by Adam Smith, who argued that individuals pursuing their self-interest in a market economy would inadvertently promote the general welfare of society. This is because the pursuit of profit by businesses leads to competition, which in turn drives down prices, increases the efficiency of production, and encourages innovation. As a result, the invisible hand ensures that the self-interest of participants is channeled into promoting general economic self-interest.

The Self-Interest of the Participants in an Economy Is Guided