Question

The ideas of Adam Smith and Karl Marx 1. ___ used the metaphor of the "invisible hand" to: a. Describe how the individual pursuit of self-interest works to promote the interest of the public as a whole b. Describe the benefits of free trade c. Describe how, ideally, income would be distributed "from each according to his ability, to each according to his need" d. Describe the appropriate, limited role of government 2. Choose the pairing that best describes Adam Smith's view of human motivation in a market economy and Karl Marx's view of human motivation in a communist economy. a. Both Adam Smith and Karl Marx believed that humans are motivated by self-interest. b. Both Adam Smith and Karl Marx believed that humans are motivated to forgo their self-interests and to cooperate instead. c. Karl Marx believed that humans are motivated by self-interest; Adam Smith believed that humans are motivated to forgo their self-interests and to cooperate instead. d. Adam Smith believed that humans in a market economy are motivated by self-interest; Karl Marx believed that humans in a communist economy are motivated to forgo their self-interests and to cooperate instead.

Answer 1

Answer: 1. A - Describe how the individual pursuit of self-interest works to promote the interest of the public as a whole

2. A- Both Adam Smith and Karl Marx believed that humans are motivated by self-interest

Explanation:

1. According to Adam Smith who is known as the father of modern economics stated in his thesis that individual's self-interest and freedom of production as well as consumption is in the best interest of the society as a whole.

Each Individual's free exchange creates signals about which goods and services are valuable. These signals will spontaneously direct competing consumers, producers, distributors, and intermediaries—each pursuing their individual plans— to fulfill the needs and desires of others.

Smith’s invisible hand became one of the primary justifications for an economic system of free market capitalism.

2. Pairing that best describes Adam Smith's view of human motivation in a market economy and Karl Marx's view of human motivation in a communist economy: Both Adam Smith and Karl Marx believed that humans are motivated by self-interest as they both believe that the economy is a capitalist economy that all its good and services are in the hands of private individuals.