In the circular flow diagram, households' payments ________ the government.
A) only flow into
B) flow into and out of
C) only flow out of
D) do not affect

Question

Quizplus · Accepted Answer

The circular flow diagram illustrates the continuous flow of goods, services, and money between households and firms. In this diagram, households pay taxes and receive transfer payments from the government. Therefore, payments flow both into and out of the government sector.

In the Circular Flow Diagram, Households' Payments ________ the Government