The Circular Flow of Income Illustrates

question 42

Multiple Choice

The circular flow of income illustrates

• A)the flows of expenditures and income in a household.
• B)that there is no relationship between goods markets and factor markets.
• C)that firms own the factors of production.
• D)the interaction of households and firms through the factors and goods markets.
• E)that the flow of payments moves in the same direction as the flow of goods.

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