Figure 2-16 -Refer to Figure 2-16. in the Circular Flow Diagram, Who

question 124

Multiple Choice

Figure 2-16
-Refer to Figure 2-16. In the circular flow diagram, who are economic agents A and who are economic agents B?

• A) A = firms; B = households
• B) A = households; B = firms
• C) A = households; B = factor markets
• D) A= firms; B = product markets

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Definitions:

Capital Goods

Goods that are used in producing other goods, rather than being bought by consumers directly, such as machinery, tools, and buildings used in production.

Economic Growth

An increase in a nation's production of goods and services, measured by its gross domestic product (GDP) over time.

Consumer Goods

Items produced for personal consumption by individuals and households.

Productivity Of Land

Productivity of land refers to the amount and value of output (crops, minerals, etc.) produced per unit area, indicating the efficiency of land use in agricultural and industrial production.