Use the following to answer questions .
Exhibit: The Circular Flow for the United States
-(Exhibit: The Circular Flow for the United States) John, a resident of the U.S., buys a new set of golf clubs from a U.S. firm. This transaction is part of:
A) personal consumption expenditures and the flow is represented by 1.
B) personal consumption expenditures and the flow is represented by 5.
C) private investment expenditure and the flow is represented by 1.
D) private investment expenditure and the flow is represented by 5.

Question

Use the following to answer questions .
Exhibit: The Circular Flow for the United States 
-(Exhibit: The Circular Flow for the United States) John, a resident of the U.S., buys a new set of golf clubs from a U.S. firm. This transaction is part of:
A) personal consumption expenditures and the flow is represented by 1. 
B) personal consumption expenditures and the flow is represented by 5. 
C) private investment expenditure and the flow is represented by 1. 
D) private investment expenditure and the flow is represented by 5.

Quizplus · Accepted Answer

John's purchase of golf clubs is a personal consumption expenditure, which is represented by flow 1 in the circular flow diagram.

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