Summarize the Economic Ideas of Adam Smith

question 4

Essay

Summarize the economic ideas of Adam Smith.How did they reflect Enlightenment optimism about human rationality? Are his views still current today?

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Definitions:

Economic Stimulus Package

A set of economic measures put forth by a government to stimulate a floundering economy and promote growth.

Budget Line

A graphical representation of all possible combinations of two goods that a consumer can purchase at given prices within his or her income.

Indifference Map

A graphical representation of combinations of goods between which a consumer is indifferent, showing preferences and trade-offs.

Budget Constraint

A representation of all the combinations of goods and services that a consumer can afford given their income and the prices of goods.