What is the direction of real flow and money flow?
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Answer and explanation
Correct answer: Both move in opposite directions
Real flow and money flow move in opposite directions in the circular-flow model. For example, goods and services move from firms to households, while the consumption payments for them move from households to firms. Similarly, factor services and factor payments move oppositely.
Frequently asked questions
What is the correct answer to this question?
Both move in opposite directions
Why is this the correct answer?
Real flow and money flow move in opposite directions in the circular-flow model. For example, goods and services move from firms to households, while the consumption payments for them move from households to firms. Similarly, factor services and factor payments move oppositely.
Which subject and chapter does this question cover?
This is a Class 11 Economics question. Chapter: National Income and Related Aggregates. Topic: GDP and Welfare.
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