Economics · Economic Theories
According to the economic principles popularized by Adam Smith, what outcome is expected if every buyer and seller in a market acts purely in their own self-interest?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1It creates systemic inefficiencies and requires immediate government intervention
- 2It results in collective public welfare and wealth maximization through an 'invisible hand' mechanism✓
- 3It hampers national economic growth due to lack of central coordination
- 4It leads to structural market monopolies and high inequality
Correct answer
It results in collective public welfare and wealth maximization through an 'invisible hand' mechanism
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