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JAMB Economics 1990 Question 4

Question 4

National Income

Use the circular flow diagram (a simple circular flow of income diagram). The lower half of the diagram indicates

Diagram for this question
  1. A.the flow of goods and services
  2. B.payments for goods and services
  3. C.the flow of income
  4. D.government transactions
Show the answer and explanation

Answer: C (the flow of income)

Explanation

The lower half shows money flows: factor payments to households and households' spending going back to firms. Together these are the flow of income.