### Understanding the Concept of the Invisible Hand#### Multiple Choice Question:**The invisible hand refers to the:**1. ◯ Tendency of monopolistic sellers to raise prices above competitive levels.2. ◯ Fact that government controls the functioning of the market system.3. ◯ Fact that the U.S. tax system redistributes income from rich to poor.4. ◯ Notion that, under competition, decisions motivated by self-interest promote the social interest.### ExplanationThis question is designed to test the understanding of the concept of the "invisible hand," a term coined by economist Adam Smith. The correct interpretation in this context is often related to how individual self-interests in a competitive market can inadvertently contribute to the overall good of society. This idea suggests that market economies are self-regulating and benefit from the aggregated effects of selfish pursuits.Select the most appropriate answer based on the provided choices.

Adam smith is a Scottish economist, he wrote about an invisible hand in his writings during the…

The invisible hand refers to the Multiple Choice tendency of monopolistic sellers to raise prices above competitive levels. fact that government controls the functioning of the market system. fact that the U.S. tax system redistributes income from rich to poor. notion that, under competition, decisions motivated by self-interest promote the social interest.

The invisible hand refers to the Multiple Choice tendency of monopolistic sellers to raise prices above competitive levels. fact that government controls the functioning of the market system. fact that the U.S. tax system redistributes income from rich to poor. notion that, under competition, decisions motivated by self-interest promote the social interest.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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