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According to the first two Fundamental Theorems of Welfare Economics, a market, satisfying certain mathematical criteria (that outline optimal conditions), is able to efficiently allocate a price-vector solution for a good with a random distribution of initial endowments. This means that a market can provide the best social outcome without outside interference when certain conditions are true. So, when a market is in disequilibrium, a market 'self-corrects' itself by having a mechanism through which individual decisions by suppliers and buyers leads to the price shifting to its optimal value - and restoring equilibrium. This is sometimes called the Invisible Hand, which was the philosophical formulation of this concept outlined in The Wealth of Nations by Adam Smith in the 1700s.
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i dont know the answer
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What economic system MOST supported the colonial economy?
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How has the UK economy changed in the last 50 years?
It has changed from being a manufacturing led economy to being a service industry and financial centre led economy.
What is meant by the term 'business' when referring to the three role-players in the economy?
Businesses are the growth engine of the most successful economy...
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