The following diagram presents a circular flow model of a simple economy. The ou

Question

The following diagram presents a circular flow model of a simple economy. The outer (green) set of arrows shows the flow of money, and the inner (red) set of arrows shows the corresponding flow of inputs and outputs. Based on this model, firms earn revenue when______firms______purchase goods and services in resource markets Read the following scenario and answer the questions that follow. Susan earns $750 per week working as an analyst for A-Plus Accountants. She uses $40 to get her car detailed at Spotless Car Wash. Spotless Car Wash pays Akshay $400 per week to detail cars. Akshay uses $50 to purchase tax services from A-Plus Accountants. Which of the events in this scenario occur in product markets? Check all that apply. Akshay spends $50 to purchase tax services from A-Plus Accountants. Akshay earns $400 per week working for Spotless Car Wash. Susan spends $40 to get her car detailed. Susan earns $750 per week working for A-Plus Accountants. Which of the elements in this scenario represent a flow from a firm to a household? This could be a flow of money, inputs, or outputs. Check all that apply. Susan's labor The $50 Akshay spends to purchase tax services from A-Plus Accountants The car detailing Susan receives The $400 per week Akshay earns working for Spotless Car Wash

Explanation / Answer

(a) Firms earn revenue when Households purchase goods & services in Product market.

(b) All of these occurs in Product markets.

(c) All of these are flow from firm to household.

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