2.4.1 National income

Question 1

Circular flow of income

Answer 1

-Households supply firms with factors of production (capital, enterprise, land, and labour) which are then used to make goods/services.
-These goods/services are then bought by households
-And firms spend this money on factor incomes such as wages, rent, interest and dividends.

Question 2

Wealth

Answer 2

stock of assets

Question 3

Income

Answer 3

flow of money