Practicing Success

Target Exam

CUET

Subject

Economics

Chapter

Macro Economics: National Income Accounting

Question:

Consider an economy where there is non-existence of money meaning money is not used for carrying on trade. What will be the flow in such an economy called as?

Options:

Capital flow

Nominal flow

Physical flow

Circular flow

Correct Answer:

Physical flow

Explanation:

Economy where money is absent means it is operating on barter system. In a barter economy, flow consists of flow of goods and services and flow of factors of production. This is real flow also known as physical flow.