In the circular flow model, the source of the factors of production used to create goods and services is the
A) product market
B) resource market
C) firms
D) households
E) exchange market

Question

Quizplus · Accepted Answer

In the circular flow model, households are the source of the factors of production (such as labor, land, and capital) which they provide to firms in exchange for income. Firms then use these factors to produce goods and services.

In the Circular Flow Model, the Source of the Factors