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Questions and Answers
What is the primary purpose of the circular flow model?
What is the primary purpose of the circular flow model?
- To predict the future growth of a country's economy
- To understand how money moves within an economy (correct)
- To analyze the effects of government policies on the economy
- To understand the behavior of individual consumers
What is the main way the circular flow model divides the economy?
What is the main way the circular flow model divides the economy?
- Into different geographic regions
- Into different industries and sectors
- Into participants and indicate how they engage in economic activities (correct)
- Into different economic systems, such as capitalist and socialist
What is included in the activities of the circular flow model?
What is included in the activities of the circular flow model?
- Only the production and spending of goods and services
- The study of international trade and finance
- The analysis of economic growth and development
- The movement of income, production, and spending between role players (correct)
What is the main benefit of using the circular flow model?
What is the main benefit of using the circular flow model?
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What is the relationship between the participants in the circular flow model?
What is the relationship between the participants in the circular flow model?
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