Which of the following is true regarding the circular flow diagram?
I. "Aggregate income" is the flow of income earned by firms.
II. Retained earnings are considered income earned by firms rather than part of households' income.
III. The government,households,and firms all have transactions in the goods market.
A) I only
B) I and II
C) I and III
D) III only
Correct Answer:
Verified
Q25: The circular flow diagram shows
A) how nominal
Q26: Q28: In the circular flow of income Q29: The factor market can best be described Q31: If we compare the four sources of Q33: In computing GDP, it is essential to Q34: In the circular flow of economic activity Q36: In the circular flow diagram, aggregate expenditure Q37: GDP counts only final goods and services Q40: 
A) households
A)
A)
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