A circular-flow diagram is a model that
A)helps to explain how consumers and the government interact with one another.
B)explains how countries trade with each other.
C)incorporates all aspects of the real economy.
D)helps to explain how the economy is organized.

Question

Quizplus · Accepted Answer

The circular-flow diagram is a simplified representation of an economy that shows how dollars flow through markets among households and firms, thereby explaining how the economy is organized.

A Circular-Flow Diagram Is a Model That