Which Is True in the Circular-Flow Diagram

question 55

Multiple Choice

Which is true in the circular-flow diagram?

• A)firms are sellers in the resource market and the product market.
• B)firms are buyers in the product market.
• C)households are sellers in the resource market.
• D)spending on goods and services flows from firms to households.

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Definitions:

Availability Heuristic

A cognitive bias that causes people to overestimate the importance of information that is readily available to them.

Illusory Correlations

The belief in a connection between two factors when, in reality, no such connection is present.

Phonemes

The minimal sound component in a language that differentiates one word from another.

Morphemes

The smallest grammatical units in a language that carry meaning, such as prefixes, suffixes, and root words.