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In the Circular-Flow Diagram, the Two Types of Markets in Which

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In the circular-flow diagram, the two types of markets in which households and firms interact are the markets for goods and services and the markets for factors of production.


Definitions:

Buyer's Disposition

The buyer's intention or decision regarding the management, use, or sale of purchased assets.

Sale on Approval

A conditional sales agreement that allows the buyer to return the purchased goods if they don't meet specified requirements.

Option to Return

A contractual provision allowing a party to return a product or relinquish a service for reasons specified in the agreement.

Sale on Approval

A transaction agreement where the buyer has the right to return the item within a specified period if it does not meet their satisfaction.

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