The Circular Flow Shows That

question 2

Multiple Choice

The circular flow shows that

• A) aggregate production equals aggregate expenditure.
• B) aggregate expenditure is less than aggregate income.
• C) GDP equals aggregate income.
• D) Both answers A and C are correct.

---

Definitions:

Late Charge

A fee assessed for payments made after their due date.

Truth-in-Lending Law

A law at the federal level in the U.S. that aims to encourage the knowledgeable use of consumer credit through mandates on disclosures regarding its terms and expenses.

Credit Offers

Proposals extended by lenders to potential borrowers detailing the terms under which credit can be extended.

Uniform Law

Legislation instituted across various jurisdictions, aiming to harmonize legal principles on specific issues.