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Which of the Following Is TRUE Regarding the Circular Flow

question 310

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Which of the following is TRUE regarding the circular flow diagram?
I. "Aggregate income" is the flow of income earned by firms.
II. Retained earnings are considered income earned by firms rather than part of households' income.
III. The government, households, and firms all have transactions in the goods market.


Definitions:

Bonds Payable

A financial accounting term for the outstanding debt a company owes to bondholders, to be paid at a future date.

Warrants

Long-term options issued by a company that grant the holder the right to purchase company shares at a specific price before a specified date.

Ex Rights

A status of a stock that signifies it is trading without the rights to a recent issue or dividend declared, affecting its immediate value.

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