Question

Adam Smith's ‘invisible hand' refers to: how households and firms, acting in their own self-interest, manage to make everyone better off. the control that large firms have over the economy. how governments allocate economic resources. how central planners made economic decisions.

Answer 1

Answer: how households and firms, acting in their own self-interest, manage to make everyone better off

Explanation:

Adam Smith's ‘invisible hand could be described as a specific market pattern that is of advantage to both the demand and supply, where both party of the demand and those supplying reach an balance, where they both gain from each other, irrespective of how it minimal. An example is the decision of an individual purchasing an item and buying other item from same company which compliments the earlier item bought.