Which Actor in the Simplified Circular Flow Model Buys or Rents

question 5

Multiple Choice

Which actor in the simplified circular flow model buys or rents land, labor, and capital?

• A) Firms
• B) Households
• C) Markets for factors of production
• D) Government

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Definitions:

Legal Costs

Expenses incurred due to legal services, which may include lawyer fees, court fees, and other related costs.

Remaining Economic Life

The estimated remaining period during which an asset is expected to be economically usable, with its cost being recoverable.

International Accounting Standards

A set of accounting standards, issued by the International Accounting Standards Board (IASB), that aim to standardize accounting practices across the globe.

R&D Costs

Expenses associated with research and development activities, aimed at discovering new knowledge or innovations that could lead to new products or improvements in existing ones.