The "Invisible Hand" Concept Suggests That

question 36

Multiple Choice

The "invisible hand" concept suggests that:

• A)changes in product demands are only randomly reflected in changes in the demands for resources.
• B)profit maximization is inconsistent with an efficient allocation of resources.
• C)government action is necessary to correct for market failures.
• D)when firms maximize their profits, society's domestic output will also be maximized.

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Definitions:

Shareholders

Individuals or entities that own one or more shares of stock in a public or private corporation, giving them partial ownership.

High-Technology Firm

A company that operates in industries involving advanced technological innovation and research.

Non-constant Growth

A situation in which a company's dividends or earnings are expected to grow at varying rates over time, as opposed to at a constant rate.

Zero Growth

A situation in which a company or economy sees no increase in income, output, or other measures of financial performance over a period.