Need help with this. Its all part of the same question, remember you gotta watch the diagram in order to answer.Also where it says: Based on this model, households earn income when_________(choose one of these: businesses or households) purchase_________(choose one of these: resources or goods and services) in the factor markets. The following diagram presents a circular flow model of a simple economy. The outer set of arrows (shown in green) shows the flow of dollars, andthe inner set of arrows (shown in blue) shows the corresponding flow of inputs and outputs. (Note: The market for outputs, also known as theproduct market, is any market where firms' products are bought and sold. The market for inputs, also known as the factor market, is any marketwhere factors of production are bought and sold.)SupplyBusinessess Demand $ $ SSS(wages, rents, interest, profits)$ Factor payments $Product marketsSFactors of production (land, labor, and capital)QFactor marketsSWQExpenditures (nominal GDP) $Actual goods and servicesHouseholds$$$ Demand $ $ $Supply Based on this model, households earn income whenpurchaseSuppose Teresa earns $525 per week working as an analyst for A-Plus Accountants. She uses $9 to have breakfast at Dinah's Diner. Dinah'sDiner pays Sam $500 per week to work as a short-order cook. Sam uses $175 to purchase tax services from A-Plus Accountants.Identify whether each of the following events in this scenario occurs in the factor markets or the product markets.EventSam spends $175 to purchase tax services from A-Plus Accountants.Teresa earns $525 per week working for A-Plus Accountants.Teresa spends $9 to have breakfast.in the factor markets.O Teresa's laborThe $500 per week Sam earns working for Dinah's DinerThe breakfast Teresa receivesWhich of the elements of this scenario represent a flow from a household to a business? This could be a flow of dollars, inputs, oroutputs. Check all that apply.Factor Markets Product Markets

Answered: the inner set of arrows (shown in blue)…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Related questions

Question

Need help with this. Its all part of the same question, remember you gotta watch the diagram in order to answer.

Also where it says:

Based on this model, households earn income when_________(choose one of these: businesses or households) purchase_________(choose one of these: resources or goods and services) in the factor markets.

The following diagram presents a circular flow model of a simple economy. The outer set of arrows (shown in green) shows the flow of dollars, and
the inner set of arrows (shown in blue) shows the corresponding flow of inputs and outputs. (Note: The market for outputs, also known as the
product market, is any market where firms' products are bought and sold. The market for inputs, also known as the factor market, is any market
where factors of production are bought and sold.)
Supply
Businesses
s Demand $ $ S
S
S
(wages, rents, interest, profits)
$ Factor payments $
Product markets
S
Factors of production (land, labor, and capital)
Q
Factor markets
S
W
Q
Expenditures (nominal GDP) $
Actual goods and services
Households
$$$ Demand $ $ $
Supply

Based on this model, households earn income when
purchase
Suppose Teresa earns $525 per week working as an analyst for A-Plus Accountants. She uses $9 to have breakfast at Dinah's Diner. Dinah's
Diner pays Sam $500 per week to work as a short-order cook. Sam uses $175 to purchase tax services from A-Plus Accountants.
Identify whether each of the following events in this scenario occurs in the factor markets or the product markets.
Event
Sam spends $175 to purchase tax services from A-Plus Accountants.
Teresa earns $525 per week working for A-Plus Accountants.
Teresa spends $9 to have breakfast.
in the factor markets.
O Teresa's labor
The $500 per week Sam earns working for Dinah's Diner
The breakfast Teresa receives
Which of the elements of this scenario represent a flow from a household to a business? This could be a flow of dollars, inputs, or
outputs. Check all that apply.
Factor Markets Product Markets

Expert Solution

Step 1

The circular flow model of a simple economy shows how money flows between households and businesses through factor and product markets in a loop.

According to the above diagram, households produce resources like labor and capital that are used by businesses to create goods and services. The business buys these resources from households which generates income for the households.

Based on this model, households earn income when businesses purchase resources in the factor markets.

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions