The Circular Flow Model Shows That

question 50

Multiple Choice

The circular flow model shows that:

• A)households are on the demand side of the resource market.
• B)firms are on the demand side of both the product and resource markets.
• C)households are on the supply side of the resource market and the demand side of the product market.
• D)firms and governments are on the supply side of the loanable funds market.
• E)governments are on the demand side of the product market and the supply side of the resource market.

---

Definitions:

Random Selection

A method of choosing individuals or items from a larger population using a process that gives each possible choice an equal chance of being selected.

Lab Rats

Commonly used term for rats that are bred and kept for scientific research.

Scientific Method

A systematic and logical approach to discovering how things in the universe work, based on observation, hypothesis, experimentation, and conclusion.

Bystander Effect

A behavior observed in social settings where the presence of other individuals decreases the likelihood of offering aid to a victim.