In the circular ﬂow model, households offer the services of factors of production to ﬁrms in return for income.

Name: In the circular ﬂow model, households offer the services of factors of production to ﬁrms in return for income.
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Question

Quizplus · Accepted Answer

This statement is true. In the circular flow model, households supply factors of production (such as labor, land, and capital) to businesses in exchange for income in the form of wages, rent, interest, and profits.

In the Circular ﬂOw Model, Households Offer the Services of Factors