Based on this model, households earn income when firms purchase goods and services in markets for factors of production. Suppose Caroline

Based on this model, households earn income when firms purchase goods and services in markets for factors of production. Suppose Caroline earns $625 per week working as jewelry appraiser for Classy’s Jewelry Store. She uses $10 to get her car washed at Spotless Car Wash. Spotless Car Wash pays Antonio $275 per week to wash cars. Antonio uses $150 to purchase a necklace from Classy’s Jewelry Store.

Answer and Explanation: Market for Factors of Production: Antonio earns $275 per week working for Spotless Car Wash. Market for Goods and Services: Caroline spends $10 to get her car washed. Antonio spends $150 to purchase a necklace from Classy’s Jewelry Store. Which of the elements of this scenario represent a flow from a household to a firm? The $150 Antonio spends to purchase a necklace from Classy’s Jewelry Store The actual economy is more complicated than the one illustrated in the previous circular-flow diagram of a simple economy – false The circular flow of income represents the flow of economic exchanges between economic agents in the economy. If a household provides the labor factor of production, it is paid and uses the same money to purchase from the same firms that produce goods and services. This is a cycle and actually doesn’t get more complex than this in real life, only involves alot more firms or economic agents.

Also Read :   Which of the following statements is true concerning stock splits?

answer; swot analysis;

The statement is true

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