Which of the Following Transactions Does Not Take Place in the Markets

question 386

Multiple Choice

Which of the following transactions does not take place in the markets for the factors of production in the circular-flow diagram?

• A) Kosuke provides plumbing services for a plumbing company and receives an hourly wage from the company for his services.
• B) Alfonso works as a marriage counselor and his clients pay him on a per-hour basis for his services.
• C) Geovany owns several shopping malls and receives rent payments from the companies that operate those malls.
• D) Carlos sells advertising for a newspaper and receives a commission from the newspaper company for each advertisement that he sells.

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Definitions:

Profit Margin

A financial metric that measures the percentage of revenue that exceeds the cost of goods sold, indicating the profitability of a company.

Profit Margin

A financial metric indicating the percentage of revenue that exceeds the costs of goods sold, showing the profitability of a company or product.

DuPont Formula

A financial analysis method that breaks down return on equity into three components: profit margin, asset turnover, and financial leverage, to help understand a company's financial performance.

Operating Income

Earnings generated from a company's core business operations, excluding deductions of interest and taxes.