Author Question: What does the concept of invisible hand imply? What will be an ideal ... (Read 71 times)

ap345 · **on:** Jun 29, 2018

What does the concept of invisible hand imply?

What will be an ideal response?

Question 2

From the economic point of view, why will an avid downhill skier devote many hours to reading, comparing, and testing a new pair of ski boots but only a few hours to deciding who to vote for in the state senator race?

A) Ski boots are ultimately more important to society than state senators.
B) He needs new ski boots; he does not need a new state senator.
C) In his estimation, being highly informed about ski boots is a better use of his time compared to being highly informed about potential state senators.
D) He is selfish.

sokh · **Reply #1 on:** Jun 29, 2018

Answer to Question 1

The invisible hand is an idea in economics that suggests that when all assumptions of a perfectly competitive market are in place, the pursuit of individual self-interest promotes the well-being of society as a whole, almost as if the individual is led by an invisible hand to do so. Thus, under perfect competition, when individuals are working to maximize personal profits, they end up promoting social interests.

Answer to Question 2

C