CE 12b Circular Flow

Government use taxes to produce

• Leaders for the government

• Weapons for the military

• Public Goods and Services

• Television Commercials

Who pays for the government taxes?

• Workers (labor)

• Homeowners/business owners (land)

• Consumers (you)

• All of the above

The circular flow is made up of a continuous interaction of which three groups?

• Workers, government and transportation

• Homeowners, business owners, car dealers

• Factories, farmers, and workers

• Households, government, and businesses

Liability can be best described as

• The amount of money a person pays for a business license

• The cost of doing business

• The amount of money left over after paying all the costs

• The risk involved in business

Which of the following is a worker?

• Land

• Labor

• Capital

• Entrepreneurship

Which of the following describes a machine used to produce a product?

• Land

• Labor

• Capital

• Entrepreneurship

What do households receive from businesses?

• Capital

• Wages

• Dividends

• Rent

According to the circular flow model where can you buy and sell a haircut?

• The Resource Market

• The Product Market

• The Labor Market

• The Barber Shop

Which term completes this economic flow?

• Taxes

• Income

• Savings

• Investment

What does the government get from businesses and households?

• Captial

• Land

• Taxes

• Wages