- The Figure Above Shows Governments in the Circular Flow

question 117

Multiple Choice

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The figure above shows governments in the circular flow

In the figure above, governments

• A)collect taxes.
• B)hire factors of production.
• C)own factors of production.
• D)coordinate economic activities of households and firms.
• E)sell goods and services to household.

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Definitions:

Depreciation

The process of allocating the cost of a tangible asset over its useful life.

Administrative Expense

Overhead or general expenses related to the day-to-day operations of a business but not directly tied to a specific project or product.

Period Cost

Costs that are expensed in the period in which they are incurred and are not directly tied to the production of inventory.

Balance Sheet

A financial statement that summarizes a company's assets, liabilities, and equity at a specific point in time.