QUIZ ABOUT CIRCULAR FLOW

OF INCOME

ANS: CIRCULAR FLOW OF INCOME

• It refers to a simple economic model which describes the reciprocal circulation of income between producers and consumers?

ANS: FIRMS

• Provide consumers with goods and services in exchange for consumer expenditure and "factors of production" from households?

ANS: Measurement of National IncomeKnowledge of Interdependence

Unending Nature of Economic ActivitiesInjections and Leakages Reference

•Give the four significance of study of circular of income

ANS: OUTPUT APPROACH

• It focuses on finding the total output of a nation by directly finding the total value of all goods and services a nation produces?

ANS: INCOME APPROACH

• It equates the total output of a nation to the total factor income received by residents or citizens of the nation?

ANS: EXPENDITURE APPROACH

• It is basically an output accounting method and it focuses on finding the total output of a nation by finding the total amount of money spent?

ANS: GDP PER CAPITA (PER PERSON)

• It is often used as a measure of a person's welfare?