A school of thought in economics that emphasizes free-market principles such as laissez-faire policies and self-regulating markets. It was developed by economists like Adam Smith and David Ricardo during the 18th and 19th centuries.
Classical Economics is like playing a game without any interference from referees or rules. The players (businesses) compete freely with each other, believing this will lead to optimal results for everyone involved.
Laissez-Faire: An economic system where transactions between private parties are free from government intervention such as regulations, privileges, tariffs, and subsidies.
Supply & Demand: Fundamental concept in economics representing the relationship between what producers supply and what consumers demand; it helps determine prices in a market economy.
Capitalism: An economic system characterized by private ownership of goods or capital.
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