Circular flow model revision

Which sector is assumed to own the resources?

• Households

• Producers

• Government

• Financial

What resources do households provide to firms

• Goods and services

• Land and Labour

• Land, Labour, Capital and Entrepreneurship

• Natural and human resources

Which sector produces goods and services?

• Households

• Producers

• Government

• Financial

What term describes money not spent on consumption?

• Investment

• Savings

• Interest

• Spending

What term describes money spent on capital goods?

• Investment

• Savings

• Interest

• Spending

Who gains and who suffers if banks increase their interest rates?

• Producers gain, households suffer

• Producers suffer, households suffer

• Producers suffer, households gain

• Producers gain, households gain

How would an increase in income tax affect the level of consumer spending?

• Decrease it

• Increase it

• Have no impact

The movements of actual goods and services between different sectors of the economy

• Money flows

• Real flows

The reward for savings or the cost of borrowing

• Savings

• Investment

• Interest

• Consumption spending

The money consumers spend on goods and services

• Savings

• Investment

• Interest

• Consumption spending