Question:medium
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: Feb 18, 2026
- Firms
- Households
- Government
- Foreign Institutional Investors
Show Solution
The Correct Option is D
Solution and Explanation
Step 1: Closed Economy Circular Flow - Review.
- Participants: Households, Firms, Government.
- Closed economies exclude foreign entities, which are present in open economies.
- Participants: Households, Firms, Government.
- Closed economies exclude foreign entities, which are present in open economies.
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