Which of the Following Best Characterizes the Circular Flow of Income

Multiple Choice

Which of the following best characterizes the circular flow of income?

A) Households buy goods and services from businesses, and businesses sell goods and services to households.
B) The government purchases resources from businesses and households and then sells goods and services to businesses and households.
C) Businesses buy resources from the government, and households buy goods and services from businesses.
D) Businesses buy resources from households, and households use their income to buy goods and services from businesses.