Adam Smith's Argument That the "Invisible Hand" of the Free

question 127

True/False

Adam Smith's argument that the "invisible hand" of the free market directed economic life more effectively and fairly than governmental intervention offered intellectual justification for those who believed that the economy should be left to regulate itself.

---

Definitions:

Comparative Advantage

The proficiency of an individual or group in executing a certain economic function more effectively than other tasks.

Lowest Cost

The scenario in which the expenditure required to achieve a certain objective or to purchase goods and services is minimized.

Opportunity Cost

The act of sacrificing possible gains from alternative decisions when one is made.

Freight Train

A freight train is a train composed of freight cars for the purpose of transporting goods and materials rather than passengers.