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The circular flow of income defines the?

The circular flow of income defines the?
Take Free Practice Test On 2026 JAMB UTME, Post UTME, WAEC SSCE, GCE, NECO SSCE
  • A Relationship between ends and means in the economic system
  • B Allocation of income to various members of the household
  • C Flow of goods, services amd money among the various micro-sectors of the economy
  • D Micro-economic relationships in economic analysis
Correct Answer: Option C
Explanation:
The circular flow of income is a neoclassical economic model depicting how money flows through the economy. In its simplest version, the economy is modeled as consisting only of households and firms. Money flows to workers in the form of wages and money flows back to firms in exchange for products.

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