Question

A young couple living in rural west-central Missouri heard about the closing of a local grocery store. Although a small operation, it served a small community that would now have to travel another 20 miles to the nearest grocery store. With help from a local realtor and banker, the couple purchased the store, remodeled it, and reopened it. As new store owners, they had to carefully watch cash flow. As their customer base began to grow, they began offering hot food, and hired others to help with the operation. The economic benefit created in this story is called:

Answer 1

the invisible hand

Step-by-step explanation:

The invisible hand is a concept developed by Adam Smith and it refers to the forces that determine the equilibrium of a market. This concept is based on the idea that both consumers and suppliers will seek their own benefit and self interest when making a transaction, but the invisible hand will help to allocate resources efficiently.

In this case, the invisible hand refers to the unexpected benefits generated by the couple reopening the grocery store. Both the owners and their customers act selfishly, but it is in their best interest that the grocery store keeps working and expanding. The whole town wins in this situation, the new owners of the grocery store make a profit and their customers don't have to travel 20 miles.