In the Circular Flow Model of an Economy, Households

question 212

Multiple Choice

In the circular flow model of an economy, households

• A) receive income from buyers of goods and services.
• B) receive income from the sale of factors in the goods markets.
• C) pay firms for the use of their factors.
• D) receive income from producers for the use of factors in the factor markets.

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Definitions:

Joint Return Test

A requirement for certain tax benefits that mandates the taxpayer to file a joint tax return with their spouse.

General Tests

Specific criteria or standards applied to determine eligibility for tax benefits or to classify income and deductions.

Single Taxpayer

A filing status for unmarried individuals that determines the tax rate and deductions they are eligible for on their income tax return.

Taxable Income

The portion of an individual's or company's income used to determine how much tax is owed to the government.