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

question 2

True/False

In the markets for goods and services in the circular-flow diagram, households are buyers and firms are sellers.

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Definitions:

Mixed Economy

An economic system blending elements of market capitalism with some form of government intervention and public enterprise.

Barter Economy

An economic system where goods and services are exchanged directly for other goods and services without using money.

Command Economy

An economic system where the government or central authority makes all decisions related to the production and distribution of goods and services.

Traditional Economy

An economic system rooted in tradition, customs, and beliefs, where resources are allocated based on inheritance and bartering is common, often found in rural and farm-based areas or developing countries.