In a sentence, describe the meaning of the phrase “invisible hand.”

The “invisible hand” is introduced in the book Wealth of the nation by Adam Smith. And it is about the economy because Adam Smith assumed economy work in the free markets. The meaning of the phrase “invisible hand” guides the business to act in the methods which are not only for the business profits but is also takes the interest of public into the different considerations when the resources are used and the products are creating. By using “invisible hand” phrase the company creates those types of products that improve the society wellbeing. For example “green” products out on the market. To make the profits the company creates this type of product as compare to destroy the environments.  

What effect should each of the following have on the demand for gasoline in a competitive market?  State what happens to demand.  Explain your reasoning in each case and relate it to a demand determinant.

(a)  an increase in the number of cars

 (d) Consumer expectations of price increases in gasoline

Answer

(a)  An increase in the number of cars

From the additional cars and the additional truck, there would be additional buyers when the demand in the number of cars is increase for the gasoline in the competitive markets because there would have the number of buyers for the gasoline.

(d) Consumer expectations of price increases in gasoline

The demand for gasoline in a competitive market increases the Consumer expectations of price because the current demand for gasoline is increased which is also change and promote the consumer

Evaluate how the following situations will affect the demand curve for iPods.

(a)   The income of 18–25-year-olds has increased percent over the last year.

By the 10% over the last year increase the 18-25 age group , the income of the 18-25 years olds has an effect on the demand of curve for iPods is that “ it will increase the demand and sale of the iPods for the higher user of the iPods.

 (d) The price of the iPhone decreases.

The effect of the price of iPods decrease on the demand curve for iPods is that; it will not have any direct effect on the iPhone prices

What effect will each of the following most likely have on the supply of corn in a competitive market?  State what happens to supply.  Explain your reasoning in each case and relate it to a supply determinant.

(a)   the development of an improved corn seed

There will increase in the supply of corn. Because increase the production of corn by the development of new seed.

(b)  an increase in the price of soybeans which can also be planted on land used for growing corn

There will fall in the supply of corn. Because soybean has higher price in the market due to the production of soybean that will be more profitable.

(c)  an increase in government payments for growing corn

There will reduce the supply of corn because of the increase in taxes, as well as duties government payment can increase.

d. an increase in the price of fertilizer

There will increase in the price of input cost. That is also creating negative impact on corn production.