________ show(s)how resources and final goods and services flow through the economy.
A) Money
B) Government
C) Allocation
D) Trade-offs
E) Circular flow

Question

Quizplus · Accepted Answer

The circular flow model shows how resources, goods, and services flow through the economy in a circular manner, indicating the interdependence of households and firms in the market. The model includes the flow of factors of production, such as labor and capital, from households to firms, and the flow of goods and services from firms to households. It also shows the flow of money from households to firms, representing the payment for factors of production, and from firms to households, representing the payment for goods and services. Thus, the circular flow model gives a comprehensive understanding of how the economy works.

________ Show(s)how Resources and Final Goods and Services Flow Through