In the circular flow diagram,
a. money flows from the firms to the households through the product market
b. money flows from the households to the firms through the product market
c. money flows from the households to the firms through the resource market
d. money flows from the households to the firms through both the product market and the resource market
e. resources flow to the households from the firms through the product market
B
You might also like to view...
The economy pictured in the figure has a(n) ________ gap with a short-run equilibrium combination of inflation and output indicated by point ________. 
A. recessionary; A B. recessionary; C C. recessionary; B D. expansionary; A
A firm is said to have excess capacity when it produces the amount of output
A) such that price is greater than marginal cost. B) such that marginal revenue is greater than marginal cost. C) smaller than that which minimizes average total cost. D) larger than that which minimizes average total cost.
When a perfectly competitive firm or a monopolistically competitive firm is making zero economic profit,
a. no firms will want to enter or exit. b. some firms will want to leave. c. some firms will want to enter. d. market demand shifts to the left. e. the price of the output will rise in the long run.
The smaller the marginal propensity to save, other things constant, _____
a. the smaller the marginal propensity to consume b. the larger the multiplier c. the smaller the multiplier d. the flatter the consumption function e. the steeper the saving function