In the Circular Flow Model, Money Flows from the Business

question 114

Multiple Choice

In the circular flow model, money flows from the business sector to the household sector through the:

• A) product market.
• B) capital market.
• C) goods market.
• D) services market.
• E) resource market.

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Definitions:

Average Variable Costs

The total variable costs of production divided by the quantity of output produced.

Demand Changes

Variations in the desire or need for a product or service, influenced by factors like price, income levels, and consumer preferences.

Price

The value that must be exchanged to obtain a good or service.

Quantity

Quantity refers to the amount or number of a material or immaterial good or service.