Identify which of the following examples reflects a way Adam Smith thought the government should be involved in the economy.
A. The government dec to let businesses set new policies about international trade
B. The government decides to prohibit box companies from selling their boxes to another country overseas
C. The government builds a road from a city to a major seaport and charges a fee for cars to drive on that road
D. The government decides to limit how many flowers any individual person can buy because supply is limited
C. The government builds a road from a city to a major seaport and charges a fee for cars to drive on that road
C. The government builds a road from a city to a major seaport and charges a fee for cars to drive on that road.
To identify which of the given examples reflects a way Adam Smith thought the government should be involved in the economy, let's analyze each option:
A. The government decides to let businesses set new policies about international trade.
This example reflects Adam Smith's belief in free trade and minimal government interference. Smith argued that governments should stay out of business decisions and allow businesses to set their own policies. Therefore, option A aligns with Adam Smith's perspective.
B. The government decides to prohibit box companies from selling their boxes to another country overseas.
Prohibiting companies from engaging in international trade goes against Adam Smith's belief in free markets. Smith advocated for open trade and removing restrictions on commerce. Therefore, option B does not align with Adam Smith's perspective.
C. The government builds a road from a city to a major seaport and charges a fee for cars to drive on that road.
This example involves government intervention in infrastructure development and imposing a fee for usage. Adam Smith believed that public goods, such as infrastructure, could be appropriately provided by the government to support economic development. Therefore, option C aligns with Adam Smith's perspective.
D. The government decides to limit how many flowers any individual person can buy because supply is limited.
Imposing limits on individual purchases does not correspond with Adam Smith's belief in free markets. Smith advocated for competition and free choice in economic transactions. Therefore, option D does not align with Adam Smith's perspective.
In conclusion, the example that reflects a way Adam Smith thought the government should be involved in the economy is:
C. The government builds a road from a city to a major seaport and charges a fee for cars to drive on that road.