A Real Flow in the Circular Flow Diagram Is

question 61

Multiple Choice

A real flow in the circular flow diagram is
i.a firm's payments of wages to its workers.
ii.a household's purchase of a new car.
iii.a farmer's use of land to grow corn.

• A) ii and iii
• B) i only
• C) i and iii
• D) ii only
• E) i, ii and iii

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Definitions:

Cut Throat Competition

An intense form of competition where businesses aggressively undercut each other's prices, often at the expense of profit margins.

Cartels

Agreements among competing firms in an industry to control prices, limit production, or divide markets, with the goal of maximizing collective profits.

Herfindahl-Hirschman Index

A measure of concentration calculated as the sum of the squares of the market share of each firm in an industry.

Largest Firm

The organization within a particular industry or market that has the highest revenue, market share, or workforce size.