In the Circular-Flow Diagram,the Factor Market Is Where

question 291

Multiple Choice

In the circular-flow diagram,the factor market is where:

• A)households buy factors of production.
• B)households buy goods and services.
• C)businesses buy goods and services.
• D)businesses buy factors of production.

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Definitions:

Obligation To Buy

A commitment or requirement to purchase a specified asset at a predetermined price, typically within a certain timeframe.

Underlying Stock Price

The current market price of the stock on which a derivative contract, such as an option, is based.

Call Option

A financial contract that gives the holder the right, but not the obligation, to buy a stock, bond, commodity, or other asset at a specified price within a specific time frame.

Time To Expiration

The duration remaining until the expiry of a contract, particularly relevant for options and other derivatives.