Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
![Suppose Teresa earns $875 per week working as a corporate attorney for Rowan and Martin Associates. She uses $9 to order a mojito cocktail at Little
Havana. Little Havana pays Sam $350 per week to wait tables. Sam uses $200 to purchase legal service from Rowan and Martin Associates.
Identify whether each of the following events in this scenario occurs in the factor market or the product market.
Event
Factor Market
Product Market
Sam spends $200 to purchase legal service from Rowan and Martin Associates.
Teresa earns $875 per week working for Rowan and Martin Associates.
Teresa spends $9 to order a mojito cocktail.
Which of the elements of this scenario represent a flow from a firm to a household? This could be a flow of dollars, inputs, or outputs. Check all that
аpply.
O Teresa's labor
O The $350 per week Sam earns working for Little Havana
O The mojito Teresa receives
O The $200 Sam spends to purchase legal service from Rowan and Martin Associates](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F05606129-48e9-4b49-9d2f-4c6e86af9c96%2F092d7df7-c0d6-47ee-9757-7f89d619c60f%2Fhettpio_processed.png&w=3840&q=75)
Transcribed Image Text:Suppose Teresa earns $875 per week working as a corporate attorney for Rowan and Martin Associates. She uses $9 to order a mojito cocktail at Little
Havana. Little Havana pays Sam $350 per week to wait tables. Sam uses $200 to purchase legal service from Rowan and Martin Associates.
Identify whether each of the following events in this scenario occurs in the factor market or the product market.
Event
Factor Market
Product Market
Sam spends $200 to purchase legal service from Rowan and Martin Associates.
Teresa earns $875 per week working for Rowan and Martin Associates.
Teresa spends $9 to order a mojito cocktail.
Which of the elements of this scenario represent a flow from a firm to a household? This could be a flow of dollars, inputs, or outputs. Check all that
аpply.
O Teresa's labor
O The $350 per week Sam earns working for Little Havana
O The mojito Teresa receives
O The $200 Sam spends to purchase legal service from Rowan and Martin Associates
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