Which of the Following Most Accurately Describes the Invisible Hand

question 12

Multiple Choice

Which of the following most accurately describes the invisible hand concept?

• A) Wise central planning by government is necessary for the efficient use of resources.
• B) In a democratic setting, majority rule will result in the efficient use of resources.
• C) In a market setting, when individuals pursue their own interests, they simultaneously tend to promote the public interest.
• D) In a market setting, when individuals pursue their own interests, they tend to engage in activities that lower the overall economic welfare of society.

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Definitions:

Market for Coffee

The global or local marketplace where coffee, as a commodity, is traded, including its production, distribution, and consumption.

Long Run

Refers to a period in which all factors of production and costs are variable, allowing firms to adjust all inputs.

Own Price Elasticity

An index that illustrates the reaction of demand for a good to the adjustment in its price.

Price Elasticity of Supply

Price Elasticity of Supply measures how the quantity of a good supplied changes in response to a change in price, indicating how sensitive the supply of the good is to price changes.