In a Simple Circular-Flow Diagram,firms

question 7

Multiple Choice

In a simple circular-flow diagram,firms

• A)purchase resources from households.
• B)purchase the output produced by households.
• C)receive income by selling resources to households.
• D)All of the above are correct.

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Definitions:

Deposit Today

The act of placing money into a financial account or investment at the current date.

Discount Rate

The interest rate used to discount future cash flows to their present value, essential in the valuation of investments and projects.

Prepaid

Expenses paid in advance for goods or services to be received in the future.

Monthly Basis

Refers to something that occurs, is measured, or is evaluated once every month.