Which of the Following Statements Is FALSE

question 355

Multiple Choice

Which of the following statements is FALSE?

• A) The value of total income is equal in value to total output because profit is a cost of production.
• B) In the circular flow model, households sell factor services to businesses in return for factor payments.
• C) Businesses sell goods and services to households who use their income to pay for them.
• D) Total income is always greater than total output.

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Definitions:

Bond Prices

The trading price of bonds in the market, which can vary based on interest rates, the bond's credit quality, and other factors, inversely related to changes in interest rates.

Interest Rates

The amount charged by lenders to borrowers for the use of assets, usually expressed as a percentage of the principal.

Limited Partnership

A partnership in which limited partners’ liabilities, investment returns, and control are limited, while general partners have unlimited liability and control.

General Partner

A member of a partnership who has unlimited liability and is actively involved in the management of the business.