Use the Circular Flow Model to provide a picture of how households, firms, and government interact.

1. What are the real flows and money flows that run between households, firms, and governments in the circular flow model?
2. What are the choices made by households and firms that determine what, how, and for whom goods and services are produced? Where in the circular flow model, do these choices appear?
3. How do the actions of governments modify what, how, and for whom goods and services are produced? Where in the circular flow model, do these choices appear?