Figure 2-2 -Refer to Figure 2-2.Boxes C and D of This Circular-Flow

question 225

Multiple Choice

Figure 2-2
-Refer to Figure 2-2.Boxes C and D of this circular-flow diagram represent

• A)households and government.
• B)firms and government.
• C)the markets for goods and services and the markets for financial assets.
• D)the markets for goods and services and the markets for factors of production.

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Definitions:

Total Utility

Total utility is the total satisfaction or benefit a consumer receives from consuming a particular quantity of goods or services.

Diminishing Marginal Utility

The decrease in satisfaction or utility that a person derives from consuming each additional unit of a good or service.

Demand Curves

A graphical representation that shows the relationship between the price of a product and the quantity of the product that consumers are willing and able to purchase at various prices.

Marginal Utility

The extra value or satisfaction garnered by a consumer with the acquisition of one more unit of a good or service.