In the Circular-Flow Diagram,which of the Following Items Flows from Households

question 199

Multiple Choice

In the circular-flow diagram,which of the following items flows from households to firms through the markets for the factors of production?

• A)goods and services
• B)land,labor,and capital
• C)dollars spent on goods and services
• D)wages,rent,and profit

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Definitions:

Depreciation

The process of allocating the cost of a tangible asset over its useful life, representing the asset's decline in value.

Cash Flow

Cash flow refers to the total amount of money being transferred into and out of a business, especially regarding liquidity.

Noncash Charge

Expenses recorded on the income statement that do not involve a direct cash outflow, such as depreciation, amortization, and impairments.

Reporting Standards

These are formal guidelines that dictate the financial reporting process, ensuring the accuracy, consistency, and transparency of financial statements.