In the simple circular-flow diagram, who are the decision makers?
A) individuals and government
B) households and firms
C) households and government
D) households, individuals, and foreign nations

Question

Quizplus · Accepted Answer

In the simple circular-flow diagram, the decision makers are households and firms. Households make decisions about what goods and services to consume and how much to save, while firms make decisions about what goods and services to produce and how much to invest in production. These decision makers interact in the market to allocate resources and determine prices.

In the Simple Circular-Flow Diagram, Who Are the Decision Makers