Unit 1 Lesson 5 Quiz

In a circular flow diagram, households are primarily responsible for:

• Providing factors of production

• Regulating the financial system

• Enforcing government policies

• Producing goods and services

What is the main function of firms within the circular flow diagram of an open-market economy?

• Providing income to households

• Consuming goods and services

• Creating and selling goods and services

• Managing government finances

In a circular flow diagram, what occurs in the product market?

• Households provide factors of production to firms.

• Firms supply goods and services to households.

• The government regulates the flow of money.

• Financial institutions exchange currency

Which two words best complete the diagram?

• National; International

• Income; Expenditures

• Households; Businesses

• Money; Goods

In the circular flow model, what do individuals/households SELL to businesses?

• Services

• Money

• Resources

• Goods

What are the four main parts of the circular flow diagram?

• Product Market, Stock Market, Factor Market, Fish Market

• Product Market, House Market, Factor Market, Good Market

• Factor Market, Product Market, Households, Businesses

• Factor Market, households, Stock Market, super market

Someone buys a car in exchange for a large amount of money. They have completed an exchange in which part of the circuclar flow model?

• Product Market

• Factor Market

• Firms

• Individuals

In the circular flow model, what do individuals receive from businesses in return for their labor?

• Services

• Money

• Resources

• D Goods

In the circular flow of the economy, what do firms provide to the product market?

• Labor

• Goods and Services

• Money

• Raw materials

Human capital includes people's ________ (check all that apply)

• Skills

• Abilities

• Health

• Motivation