Question:
Which of the following is not a part of the Circular flow of Income in a closed economy?
Which of the following is not a part of the Circular flow of Income in a closed economy?
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Closed economy = no foreign trade; open economy includes exports/imports and foreign investors.
Updated On: Sep 18, 2025
- Firms
- Households
- Government
- Foreign Institutional Investors
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The Correct Option is D
Solution and Explanation
Step 1: Recall closed economy circular flow.
- Participants: Households, Firms, Government
- Foreign entities are part of open economy flow, not closed economy
- Participants: Households, Firms, Government
- Foreign entities are part of open economy flow, not closed economy
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