According to , self-interest and competition act as , guiding firms in a market-based economy.
Answers
Answer:
Adam Smith described self-interest and competition in a market economy as the "invisible hand" that guides the economy. This episode of the Economic Lowdown Podcast Series explains these concepts and their importance to our understanding of the economic system.
Self-interest and competition
Explanation:
Adam Smith described self-interest and competition in a market economy as the "invisible hand" that guides the economy. In an economy, each person can have many reasons for trading a particular product, but at the core of it all is his self-interest and competition with the others. He wants to make profits so he can buy the things he wants and provide for his family. Another motivation for him to do better would be to outshine is competition and make better profits than them.