In the Markets for Goods and Services in the Circular-Flow

question 31

Multiple Choice

In the markets for goods and services in the circular-flow diagram,

• A)households and firms are both buyers.
• B)households and firms are both sellers.
• C)households are buyers and firms are sellers.
• D)households are sellers and firms are buyers.

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Definitions:

Risk

The exposure to uncertainty or the potential of loss that can occur as a result of an investment's actual return differing from the expected return.

Acquisition Analysis

A financial and strategic assessment to understand the value, synergies, and potential benefits of acquiring a company or asset.

Target Firm

A target firm is a company that is identified as a potential acquisition candidate by another company or investor.

Merger NPV

The net present value of combining two or more companies, taking into account the projected cash flows and synergies resulting from the merger.