Within the circular flow model,which of the following is not represented as a flow of funds into firms?
A)Foreign purchases of goods and services.
B)Income payments.
C)Consumption spending.
D)Government purchases.

Question

Quizplus · Accepted Answer

Income payments represent a flow of funds from firms to households, not into firms. In the circular flow model, firms receive money from households through consumption spending, from the government through government purchases, and from foreign entities through exports, but they pay income to households in the form of wages, interest, rent, and profits.

Within the Circular Flow Model,which of the Following Is Not