Which of the Following Models Explains the Nature of Economic

question 73

Multiple Choice

Which of the following models explains the nature of economic transactions in terms of a flow of resources from businesses to households and back again?

• A)The circular flow model
• B)The triple bottom line model
• C)The pyramidal flow model
• D)The neoclassical model

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Definitions:

Marginal Revenue

The plus income from the sale of one more unit of a good or service.

Competitive Market

A market structure characterized by a large number of buyers and sellers, where no single entity can dictate prices or terms, leading to an efficient allocation of resources.

Equilibrium Price

The price at which the quantity of a good or service demanded equals the quantity supplied, leading to a stable market condition.

Marginal Cost

The expenditure required to produce an additional single unit of a product or service.