6
QuizMultiple Choice

New Economic Theories

Question 6 • SS221 World History/Geography A

The three main ideas behind capitalism as defined by Adam Smith are

Answer
A
free markets, laissez-faire, and fair taxes.
B
competition, self interest, and laissez-faire.
C
laissez-faire, regulation, and self interest.
D
competition, free markets, and trade limits.

Explanation

Adam Smith’s key ideas are competition, self-interest, and laissez-faire. Competition among sellers and buyers helps shape prices, while people pursuing their own interests can contribute to economic activity. Laissez-faire means limiting government interference in the economy, so choice B is correct.

AI-written and checked against the verified answer.

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