The simple circular flow model shows that:
A. households are on the buying side of both product and resource markets.
B. businesses are on the selling side of both product and resource markets.
C. households are on the selling side of the resource market and on the buying side of the
product market.
D. businesses are on the buying side of the product market and on the selling side of the
resource market.
Answer: C
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The assumption that wages change more slowly than prices provides an argument for the
A) aggregate demand curve having a positive slope. B) aggregate demand curve having a negative slope. C) aggregate supply having a negative slope. D) aggregate supply having a positive slope.
The free-rider dilemma occurs in the provision of public goods because an individual can realize the benefits of someone else's purchase (consumption) of a public good.
Answer the following statement true (T) or false (F)