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What is a situation in which households purchase the goods and services that firms produce?
A common situation in which households purchase goods and services from firms occurs during everyday shopping at grocery stores. Households buy food, household items, and personal care products, which are produced by various firms. This exchange reflects the basic economic principle of consumption, where households fulfill their needs and wants by purchasing the outputs of firms in the market. Additionally, households may also purchase services, such as haircuts or car repairs, demonstrating the ongoing interaction between consumers and producers in the economy.
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In a free market economy the factor market involves which type of exchange?
a. the goods and services that households produce are purchased by firms.b. firms purchase factors of production from householdsc. Households purchase factors of production from firmsd. firms loan money to households to purchase capital
What Distinguish between the resource market and the product market in the circular flow model?
businesses purchase what they use to produce goods and services. Resources are in the form of labor, natural resources, capital, and entrepreneurship, all of which are supplied by households.
Payments in the free market circular flow model?
In the free market circular flow model, payments occur as money flows between households and firms. Households provide factors of production, such as labor, to firms in exchange for wages. Firms produce goods and services, which households purchase, creating a continuous loop of economic activity. This model illustrates the interdependence of consumers and producers in an economy, highlighting how payments facilitate the exchange of resources and products.
What types of exchanges are shown in the circular flow model?
The circular flow model illustrates two main types of exchanges: the exchange of goods and services between households and firms, and the exchange of factors of production (like labor) for income. Households provide labor to firms in return for wages, while firms produce goods and services that households purchase. This model highlights the interdependence between the two sectors and how money flows in both directions—through spending and income. Additionally, it can include government and foreign sectors, showing taxes, public spending, and international trade.
What represents a real flow in the circular flow model?
In the circular flow model, real flows represent the movement of goods and services between households and firms. Households provide factors of production, such as labor, to firms, while firms produce goods and services that are consumed by households. This interaction illustrates the interdependence of economic agents in the economy, where production and consumption occur simultaneously. Real flows are complemented by monetary flows, which represent the payment for these goods and services.
In a free market economy the factor market involves which type of exchange?
a. the goods and services that households produce are purchased by firms.b. firms purchase factors of production from householdsc. Households purchase factors of production from firmsd. firms loan money to households to purchase capital
What is good market?
businessess produce goods and services and sells them to households
What Distinguish between the resource market and the product market in the circular flow model?
businesses purchase what they use to produce goods and services. Resources are in the form of labor, natural resources, capital, and entrepreneurship, all of which are supplied by households.
How do firms purchase or pay for the labor that they used to produce their goods and services?
Salaries and Wages
What good and services to produce?
What good and services to produce?
Describe the role that workers play in the game of economics?
Workers produce all of the goods and services that producers provide and customers purchase.
Describe the role that workers play in the game of economics.?
Workers produce all of the goods and services that producers provide and customers purchase.
How is production important in the provision of goods and services to consumers?
Production of goods is important for services and companies because companies must produce in mass what goods or services consumers will purchase. If customers do not wish to purchase a certain good or service, then it could cost a company mass amounts of money if they have produced it.
Describe the circular Flow Model?
The circular flow model is a summary of the operation of a market economy, that is the flow between production factors (firms) and households. Firms provide an income to households though employment (labour) and in the same manor households spend their income on firms for services and products.
In a circular flow diagram labor and other factors of production are sold on resource markets. these resources are then used to produce goods ands services sold onn product markets. how are businesses?
In a circular flow diagram, businesses acquire labor and other factors of production from resource markets, which they use to create goods and services. These products are then sold in product markets to households and consumers. This process generates revenue for businesses, which can be reinvested to purchase more resources or expand operations, creating a continuous cycle of production and consumption within the economy. Ultimately, this flow illustrates the interdependence between businesses, households, and markets.
Example of a productive resources that households sell to government?
Households usually only sell labor to the government or to any other firm. Households are not able to produce anything else that would be of use the the government. If a person was a government worker, that would be selling their labor to the government.
What are the four basic questions of economy?
What goods and services will be produced?How will the goods and services be produced?Who will get the goods and services?How will the system accomodate change?
