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    Question

    What is the role of business firms in an economy?

    A To generate income Correct Answer Incorrect Answer
    B Public expenditure Correct Answer Incorrect Answer
    C To save Correct Answer Incorrect Answer
    D To produce goods Correct Answer Incorrect Answer

    Solution

    Firms are one of the three crucial elements in the circular flow of money through the economy. In economics, producers are often referred to as firms or companies that play a role in using inputs and producing goods and services. Firms play a key role in deciding what to produce and how to produce.

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