Exploring Adam Smith's Economic Principles

Who is considered the father of modern economics?

• David Ricardo

• Adam Smith

• Milton Friedman

• John Maynard Keynes

What book did Adam Smith write that laid the foundations for modern economics?

• The General Theory

• Das Kapital

• Principles of Political Economy

• The Wealth of Nations

What economic theory dominated before Adam Smith's 'The Wealth of Nations'?

• Capitalism

• Socialism

• Mercantilism

• Feudalism

What did Adam Smith argue was outdated during his time?

• Monarchy

• Feudalism

• Mercantilism

• Capitalism

What major historical events coincided with the publication of 'The Wealth of Nations'?

• The French Revolution and the American Revolutionary War

• The Industrial Revolution and the American Civil War

• World War I and the Russian Revolution

• The Enlightenment and the Spanish Succession

According to Adam Smith, what are the three primary factors of production?

• Labor, machines, capital

• Land, labor, entrepreneurship

• Land, money, technology

• Land, labor, capital

What does 'capital' in economic terms include according to Adam Smith?

• Government bonds

• Only physical assets

• Resources like machinery and patents

• Only money

What did Adam Smith believe would naturally lead to a nation's economic development?

• Technological innovation

• Agricultural advancement

• Trade and specialization

• Government intervention

What concept did Adam Smith introduce to explain the division of labor?

• The invisible hand

• The guiding hand

• Economic equilibrium

• Specialization

How did Adam Smith view the role of government in the economy?

• To redistribute wealth

• To control all economic resources

• To protect rights and enforce contracts

• To actively manage the economy