Refer to the diagram. flow 1 represents

Resource Market Flow Businesses Households low 3 Product Market Flow 4 Refer to the diagram, Flow 1 represents: A. goods and services s 9. wage, rent, interest, and profit income. C. land, labor, capital, and entrepreneurial ability. D. consumer expenditures


Correct choice is B

See that the arrow runs from Business to households. This implies that businesses are paying households a remuneration for their services. Hence wages, rents and profits are the factor payments received in Flow 1.

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