Which of the Following Is an Important Premise of Smith's

question 58

Multiple Choice

Which of the following is an important premise of Smith's conclusions about economic prosperity?

• A) Individual freedom is necessary if a society is to prosper.
• B) Understanding the concept of survival of the fittest will lead to prosperity.
• C) Determining what motivates people will lead to prosperity.
• D) Command economies and structured markets must be in place before we can work toward prosperity.

---

Definitions:

Dominant Firms

Companies that hold a large market share within their industry, influencing market conditions and prices.

Entry Barriers

Obstacles that prevent or hinder potential competitors from entering a market or industry.

Substantial Entry

A significant entry of new firms into a market, often leading to increased competition and affecting market dynamics.

Flexible Prices

Product prices that freely move upward or downward when product demand or supply changes.