According to the circular flow model, expenditures by one person translate:
A) directly into income for someone else.
B) indirectly into the value of that person's time.
C) directly into taxes collected by a local government.
D) indirectly into the household's budget.

Question

Quizplus · Accepted Answer

According to the circular flow model, expenditures by one person (such as buying goods or services) go directly into the income of someone else (such as a producer or seller). This creates a cycle of income and spending that keeps the economy moving.

According to the Circular Flow Model, Expenditures by One Person