Figure 2-2 -Refer to Figure 2-2.If the Outer Loop of This Circular-Flow

question 256

Multiple Choice

Figure 2-2
-Refer to Figure 2-2.If the outer loop of this circular-flow diagram represents flows of dollars,then the inner loop includes

• A)flows of goods and services from households to firms.
• B)flows of inputs from households to firms.
• C)flows of rent payments paid to owners of land.
• D)flows of wages and salaries paid to workers.

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Definitions:

Loss Carryback

A tax provision that allows businesses to apply a net operating loss to past tax years in order to receive a tax refund.

Income Before Taxes

The amount of income a company generates before accounting for income taxes, often used to assess the profitability of a company excluding tax expenses.

Income Tax Rate

The proportion of an entity's income that is subjected to taxation.

Deferred Tax Note

An explanatory note in financial statements detailing the amounts and causes of deferred tax assets and liabilities.