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WorksheetsLesson 2. Circular Flow of Economic Activity
Total questions: 20
Worksheet time: 10mins
Where are factors of production (land, labor, etc) exchanged in the circular flow model?
Factor Market
Product Market
Firms
Individuals
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
A person stocks shelves at a grocery store and receives a wage. They have completed an exchange in which part of the circular flow model?
Individuals
Businesss
Factor Market
Product Market
Money exchanged between businesses and individuals for labor.
wages
revenue
spending
profit
Money exchanged between an individual and a store for a good or service.
Revenue
Wages
Rent
Donation
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
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 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, Firms
Factor Market, households, Stock Market, super market
Goods and services are sold in the ___ market
Factor
Product
Illegal
Black
Two sector economy consists of:
households, firms
firms, foreign sector
households, government
firms, government
Which of the following is the consumption sector?
households
firms
foreign
government
In a closed economy, ........................... is not included?
households
firms
government
Foreign sector
Which of the following is an injection in the circular flow of income?
An increase in the level of household savings
An increase in the level of investment
A reduction in government expenditure on infrastructure
An increase in taxes (with government expenditure held constant)
Firms sell their resources to Households, and in exchange they are paid an income
True
False
Capital...
is the ability to combine all 4 resources
is the human made items used in the production process
Savings are leakages from the Circular Flow.
True
False
