2 The Circular Flow Model The Following Diagram Presents A Circular Flow Model Of A Simple Economy The Outer Set Of Ar 1 (111.23 KiB) Viewed 9 times
2. The circular-flow model 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 red) shows the corresponding flow of inputs and outputs. Firms Markets for Goods and Services Markets for Factors of Production Households Based on this model, firms earn revenue when households purchase in product markets. Suppose Ana earns $850 per week working as an analyst for A-Plus Accountants. She uses $8 to order a mojito cocktail at Little Havana. Little Havana pays Yakov $475 per week to wait tables. Yakov uses $125 to purchase tax services from A-Plus Accountants.
Identify whether each of the following events in this scenario occurs in the factor market or the product market. Event Yakov spends $125 to purchase tax services from A-Plus Accountants. Ana earns $850 per week working for A-Plus Accountants. Ana spends $8 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 apply. The $125 Yakov spends to purchase tax services from A-Plus Accountants The mojito Ana receives Factor Market Product Market Ana's labor The $475 per week Yakov earns working for Little Havana
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