Which actor in the simplified circular flow model buys or rents land, labor, and capital?
A. Firms
B. Households
C. Markets for factors of production
D. Government
A. Firms
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Economists distinguish between normal and inferior goods using
a. price elasticity of demand b. price elasticity of supply c. income elasticity of demand d. cross-price elasticity of demand e. tax incidence
An appreciation in the value of the dollar would
a. make U.S. goods less expensive to foreigners. b. encourage U.S. consumers to buy more foreign goods. c. increase the number of dollars that could be purchased with a Mexican peso. d. discourage U.S. consumers from traveling abroad.
Which of the following statements is correct??
A. The fact that the firms in an oligopoly are mutually interdependent means that individual firms do not have any market power. B. All else? constant, a monopoly firm has more market power than a monopolistically competitive firm. C. The amount of market power a firm possesses is unrelated to the type of market in which it operates. D. So long as a firm is sufficiently? large, it will have some amount of market? power, regardless of the type of market in which it operates.
Differentiate between the current account balance and the capital account balance.
What will be an ideal response?