In the circular-flow diagram,which of the following items does not flow from households to firms?
A)revenue
B)land,labor,and capital
C)factors of production
D)profit

Question

Quizplus · Accepted Answer

Households do not directly provide profits to firms. Firms earn profits as a result of their production activities using factors of production (such as land, labor, and capital) that are supplied by households. The revenue earned by firms and the factors of production (i.e. land, labor, and capital) are all inputs to the production process that households supply to firms in the circular flow diagram.

In the Circular-Flow Diagram,which of the Following Items Does Not