The Invisible Hand Principle Indicates That Competitive Markets Can Help

question 135

Multiple Choice

The invisible hand principle indicates that competitive markets can help promote the efficient use of resources

• A) only if buyers and sellers really care, personally, about economic efficiency.
• B) even when each market participant cares only about their own self interest rather than about the overall efficiency of resource use.
• C) even if business firms fail to produce goods efficiently.
• D) if, and only if, businesses recognize their social obligation to keep costs low and use resources wisely.

---

Definitions:

Balance Sheet

A financial statement that provides a snapshot of a company's financial position at a specific point in time, showing assets, liabilities, and equity.

Spreadsheet

A software tool that allows users to organize, analyze, and store data in a table with rows and columns.

Job-Order Costing

An accounting method that assigns costs to specific jobs or batches, ideal for customized or made-to-order products.

Manufacturing Overhead

Indirect factory-related costs that are incurred when producing a product, including costs such as utility expenses for the plant.