In the Second Circular-Flow Model of Chapter 2,households Have Two

question 67

Multiple Choice

In the second circular-flow model of Chapter 2,households have two uses for their total income:

• A)consumption and investment.
• B)consumption and saving.
• C)saving and investment.
• D)saving and payment of taxes.
• E)consumption and payment of taxes.

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Definitions:

Economic Value

Refers to the worth of a good or service determined by the market and the benefits it provides to those who purchase or use it.

Wages

Payments made to employees by employers in exchange for work performed, often expressed as an hourly, daily, or piece rate.

Running Mate

A candidate selected by a political party's nominee for President to run for Vice President as part of the same ticket in an election.

Presidential Election

denotes the process by which a country's president is elected, typically involving a nationwide vote.