The circular flow diagram of economic activity is a model of the:
A. flow of goods, services, and payments between households and firms.
B. influence of government on business behaviour.
C. role of unions and government in the economy.
D. interaction among taxes, prices, and profits.
Answer:A
The circular flow diagram of economic activity is a model of the:
A. flow of goods, services, and payments between households and firms. B. influence of government on business behaviour. C. role of unions and government in the economy. D. interaction among taxes, prices, and profits.
Explanation: 29. Which of the following best characterizes the circular flow of income?