1. The expanded circular-flow diagram Aa Aa The diagram below shows an expansive
ID: 1209811 • Letter: 1
Question
1. The expanded circular-flow diagram Aa Aa The diagram below shows an expansive circular-flow diagram for the U.S. economy, with arrows pointing in the direction that money flows. To facilitate reference, letter labels have been placed on certain arrows of the diagram Government purchases of goods and services Government borrowing Government Taxes Government transfers Private savings Households Consumer spending Wages, profit, interest, rent Markets for goods and services Factor markets Financial markets Wages, profit, Gross domestic product interest, rent Borrowing and stock issues by firms Firms Investment spending Foreign borrowing and sales of stoc Exports Rest of world Imports Foreign lending and purchases of stock Which one of the following arrows best represents the flow of money when Americans purchase stock shares of companies listed on the Singapore exchange?Explanation / Answer
1. B is the right situation which explains about investments in foreign nation.
2. second alternative is right
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