Exhibit 1.1 -Refer to the Circular-Flow Model in Exhibit 1.1. If Box

question 135

Multiple Choice

Exhibit 1.1

-Refer to the circular-flow model in Exhibit 1.1. If box D represents firms, then box C represents:

• A) firms.
• B) resource markets.
• C) households.
• D) product markets.
• E) expenditures.

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Definitions:

Total Assets

The sum of all current and non-current assets owned by a business, indicating its total resources.

Cost Per Unit

The total expense incurred in manufacturing or acquiring a product divided by the number of units.

Purchased

Acquired in exchange for money or its equivalent; obtaining ownership of a good or service.

Days' Sales

A financial ratio that measures the average time it takes a company to convert its inventory into sales.