Circular Flow Chart

What does the circular flow matrix show?

• How products, resources, and money flow in the economy
• How to escape the Matrix
• How businesses make profits
• How households spend money

In a market economy, what are the two main sectors?

• Government and businesses
• Households and government
• Households and businesses
• Producers and consumers

Where do businesses sell goods and services to households?

• Resource market
• Product market
• Financial market
• Government market

What are the four factors of production mentioned in the video?

• Land, labor, capital, and entrepreneurship
• Money, machines, workers, and raw materials
• Factories, offices, stores, and farms
• Wages, rent, interest, and profit

In the resource market, who supplies the resources?

• Businesses
• Government
• Households
• Banks

What is consumer spending?

• Money households pay businesses for goods and services
• Money businesses pay households for resources
• Money government collects in taxes
• Money businesses invest in new equipment

What do businesses call the money they receive from selling products?

• Profit
• Income
• Revenue
• Wages

What is the term for payments businesses make to resource owners?

• Consumer spending
• Government spending
• Transfer payments
• Factor payments

Which of these is NOT one of the four types of factor payments mentioned?

• Rent
• Wages
• Dividends
• Profit

Is a local mall an example of a product market or resource market?

• Product market only
• Resource market only
• Both product and resource market
• Neither product nor resource market