What role do households play in the capital market? What role do firms play?

What will be an ideal response?


In the capital market households are the suppliers of funds. Firms demand these funds in order to purchase capital goods.

Economics

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Opportunity cost is represented on the production possibilities frontier by

A) attainable and unattainable points. B) efficient and inefficient points. C) the amount of good Y forgone when more of good X is produced. D) technological progress.

Economics

A line graph comparing total cost and total revenue for a good in a perfectly competitive market will consist of two ascending lines representing total cost and total revenue. Where on these lines is maximum profit indicated?

a. The smallest gap between total revenue and total cost b. The point where total revenue passes total cost c. The point where total cost passes total revenue d. The largest gap between total revenue and total cost

Economics

Linda's Autoplex performs oil changes on automobiles, light trucks, and sport utility vehicles. She is a profit-maximizing business owner whose firm operates in a competitive market. The marginal cost of an oil change is $10 . The marginal productivity of the last worker that Linda hired was 1.5 oil changes per hour. What is the maximum hourly wage that Linda was willing to pay the last worker

hired? a. $10 b. $15 c. $20 d. $30

Economics

Which of the following is NOT a characteristic of a monopolistically competitive market?

A. There is only one firm selling a product. B. There are many firms selling products that are similar but not identical. C. There are many firms that have some control over price. D. There are no artificial barriers to entry.

Economics