The circular ﬂow model illustrates
A) the importance of having a central plan for the economy.
B) how capital and other resources are created.
C) how money is created by the banking system.
D) the interdependence of businesses and consumers.

Question

Quizplus · Accepted Answer

The circular flow model shows how businesses and consumers rely on each other by exchanging goods and services for money. It demonstrates the interdependence of businesses and consumers in the economy.

The Circular ﬂOw Model Illustrates