Which of the following is not an example of spending on goods and services in the circular flow model?
A)Amanda purchases a new electric guitar to pursue her hobby seriously.
B)Chaitanya buys a new spa pedicure chair for her expanding nail salon business.
C)Hernan buys a pizza at Papa C's.
D)Lenny buys a new digital camera to take pictures at his son's graduation.

Question

Quizplus · Accepted Answer

In the circular flow model, spending on goods and services typically refers to consumer spending for personal use, not business investments or purchases for business expansion, which is what Chaitanya's purchase represents.

Which of the Following Is Not an Example of Spending