Question

What is the economic theory advocated by Adam Smith, emphasizing limited government intervention and individual freedom ?

• A. Laissez Faire
• B. Socialism
• C. Mercantilism
• D. Keynesian Economics

Answer 1

Answer:

A. Laissez Faire

Adam Smith – the father of Economics

• His book, “An Enquiry into the Nature and Causes of the Wealth of Nations” has laid a strong foundation for Economics.

• He described Economics as the study of wealth and wanted limited government intervention in the economic activities and argued for more freedom to individuals. This is known as the theory of ‘Laissez Faire’.