Principles of Microeconomics, 7th Edition

Published by South-Western College
ISBN 10: 128516590X
ISBN 13: 978-1-28516-590-5

Chapter 1 - Part I - Ten Principles of Economics - Quick Check Multiple Choice: 4

Answer

b. the ability of free markets to reach desirable outcomes, despite the self-interest of market participants

Work Step by Step

Adam Smith holds that people are self-motivated but an intangible force (known as the invisible hand) guides this self-motivated activity to promote general economic well-being. In other words, by pursuing their own interests, people tend to make others better off in the economy. For example, when a baker sells bread in order to make money, he makes people who want to purchase bread better off.
Update this answer!

You can help us out by revising, improving and updating this answer.

Update this answer

After you claim an answer you’ll have 24 hours to send in a draft. An editor will review the submission and either publish your submission or provide feedback.