Which of the following statements is false? In the circular flow model:
A)the funds needed to finance investment spending come from the saving of households.
B)GDP can be measured either by the income received or by the expenditures made.
C)factor payments are made to business firms.
D)consumption expenditures are made by households.

Question

Quizplus · Accepted Answer

In the circular flow model, factor payments (such as wages, rent, and interest) are made to households by business firms in exchange for the use of factors of production (labor, land, and capital), not the other way around.

Which of the Following Statements Is False? in the Circular