In a Simple Circular-Flow Diagram,households Buy Goods and Services with the Income

question 21

Multiple Choice

In a simple circular-flow diagram,households buy goods and services with the income they get from

• A)wages.
• B)rents.
• C)profits.
• D)All of the above are correct.

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Definitions:

Lemons

A term popularized in economics referring to the problem of asymmetric information concerning the quality of products, specifically used in the context of used cars.

Potential Buyers

Individuals or entities that show interest in purchasing a product or service but have not yet completed the transaction.

Rustbucket

A term colloquially used to describe an old, dilapidated vehicle, especially one suffering from rust and decay, indicating poor condition.

Used Cars

Pre-owned vehicles that have been previously registered and are available for sale, usually at a lower price than similar new models.