Business, 22.01.2021 19:50 jdenty3398

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. Markets for Goods and Services Firms Households Markets for Factors of Production

Based on this model, households earn income when purchase in resource markets.

Suppose Cho earns $600 per week working as a doctor for the Medical Clinic. She uses $10 to buy a box of aspirin at Pillmart Pharmacy. Pillmart Pharmacy pays Bob $225 per week to work the cash register. Bob uses $225 to purchase medical services from the Medical Clinic.

Identify whether each of the following events in this scenario occurs in the resource market or the product market.

Event

Resource Market

/ Product Market

Cho spends $10 to buy a box of aspirin.
Bob spends $225 to purchase medical services from the Medical Clinic.
Cho earns $600 per week working for the Medical Clinic.
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 $225 per week Bob earns working for Pillmart Pharmacy
The $225 Bob spends to purchase medical services from the Medical Clinic
The aspirin Cho receives
Cho's labor

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The following diagram presents a circular-flow model of a simple economy. The outer set of arrows (s...

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