Which of the following statements is NOT true about the two-sector model?
The government sector plays an important role.
In a two-sector model, the economy is simplified to include only two sectors: households and firms. There is no foreign sector, and the government sector's role, while important, is often simplified or excluded in basic models. The statement that 'Firms are the only producing sector in the economy' is the one that is NOT true, because the government sector can also produce goods and services.
Important Questions from Microeconomics
Surge pricing takes place when a service provider
What effect will a decrease in demand and an increase in supply have on equilibrium price?
A situation where the expenditure of the government exceeds its revenue is called ______.
Which of the following statements is NOT correct about the factors that gave rise to the Consumer Movement in India?
The total value of goods and services traded is considered to be the _________ of trade.
