Question

With which of these statements would Adam smith agree?

A. The government, not the people, should control all means of production
B. The government should protect the people from the significant changes in the economy
C. The people, not the government, can best determine the structure of the economy
D. The people should leave major economic decisions to the government

Answer 1

C. The people, not the government, can best determine the structure of the economy

Step-by-step explanation:

Adam Smith and David Ricardo are the fathers of economic Liberalism. They opposed mercantilism and the planning and control of the economy by the government. Under mercantilism, trade was controlled, one of the reasons was that the ruler was responsible for the well being of every subject, and had to protect them from the shocks of the economy. Liberalism opposed this idea, Smith argued that instead of controlling the economy, the government should let the market regulate itself.

For example, instead of stockpiling corn in case of a shortage, Smith argued that the government should sell the surplus and if there was a shortage, they would be able to buy food from other countries.