The circular-flow diagram illustrates how firms _____ goods and services and _____ factors of production.

A) buy;sell
B) buy;buy
C) sell;buy
D) sell;sell

Circular-Flow Diagram

A visual model of the economy showing the interactions between households and businesses through the markets for products and resources.

Firms

Business organizations that use resources to produce goods or services for profit.

Goods and Services

Refers to tangible products and intangible activities that fulfill the needs or wants of consumers.