The Circular Flow Diagram Shows That

question 256

Multiple Choice

The circular flow diagram shows that

• A)the value of total income is equal to the total value of expenditures on final goods and services.
• B)firms pay households wages,and households receive transfer payments from firms.
• C)households spend all their income on goods and services.
• D)GDP will be less than the total value of expenditures on final goods and services in the economy.

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Definitions:

Generalization

When a conditioned response is elicited in response to things similar to the conditioned stimulus.

Discrimination

Narrowing the conditions that produce the conditioned response.

Deconditioning

Reversing conditioning to eliminate the conditioned response.

Conditioned Response

The response produced by the conditioned stimulus after classical conditioning (e.g., salivation following the sound of the bell).