ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Smith’s 3 natural laws of economics: Law of self-interest – people work for their own good. Law of competition – competition forces people to make a better product for lower price. Law of supply and demand – enough goods would be produced at the lowest price to meet the demand in a market economy.

Detailed explanation-2: -What Were Adam Smith’s 3 Laws of Economics? The law of self-interest, the law of competition, and the law of supply and demand were the three laws of economics written by Adam Smith.

Detailed explanation-3: -Smith’s best-known ideas formed the basis of economic theory, including the invisible hand theory (the idea that free-markets coordinate themselves), the division of labor (the idea that people should specialize in specific tasks), and the measurement of economic activity (Gross Domestic Product).

Detailed explanation-4: -The term “invisible hand” first appeared in Adam Smith’s famous work, The Wealth of Nations, to describe how free markets can incentivize individuals, acting in their own self-interest, to produce what is societally necessary.