Which of the Following Is True Regarding the Circular Flow

question 223

Multiple Choice

Which of the following is true regarding the circular flow diagram?
I. "Aggregate income" is the flow of income earned by firms.
II. Retained earnings are considered income earned by firms rather than part of households' income.
III. The government,households,and firms all have transactions in the goods market.

• A) I only
• B) I and II
• C) I and III
• D) III only

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