2. The circular-flow model The following diagram presents a circular-flow model of a simple economy. The outer set of arrows (shown in green) shows the flow of dollars, and the inner set of arrows (shown in red) shows the corresponding flow of inputs and outputs. Markets for Goods and Services Firms Households Markets for Factors of Production Based on this model, households earn income when purchase in factor markets. Suppose Kate earns $625 per week working as a doctor for the Medical Clinic. She uses $8 to have breakfast at Dinah's Diner. Dinah's Diner pays Hubert $500 per week to work as a short-order cook. Hubert uses $175 to purchase medical services from the Medical Clinic, Identify whether each of the following events in this scenario occurs in the factor market or the product market. Event Factor Market Product Market

2. The circular-flow model The following diagram presents a circular-flow model of a simple economy. The outer set of arrows (shown in green) shows the flow of dollars, and the inner set of arrows (shown in red) shows the corresponding flow of inputs and outputs. Markets for Goods and Services Firms Households Markets for Factors of Production Based on this model, households earn income when purchase in factor markets. Suppose Kate earns $625 per week working as a doctor for the Medical Clinic. She uses $8 to have breakfast at Dinah's Diner. Dinah's Diner pays Hubert $500 per week to work as a short-order cook. Hubert uses $175 to purchase medical services from the Medical Clinic, Identify whether each of the following events in this scenario occurs in the factor market or the product market. Event Factor Market Product Market

Survey Of Economics

10th Edition

ISBN:9781337111522

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter4: Markets In Action

Section: Chapter Questions

Problem 1SQP

See similar textbooks

Similar questions

1. The economy's income and expenditure The following diagram presents a circular-flow model of a simple economy. The outer set of arrows (shown in green) shows the flow of dollars, and the inner set of arrows (shown in red) shows the corresponding flow of inputs and outputs. Firms Markets for Goods and Services Markets for Factors of Production Based on this model, households earn income when Households purchase in markets for factors of production. Suppose Megan earns $575 per week working as a flight attendant for Flyaway Airlines, She uses $9 to order a mojito cocktail at Little Havana. Little
Suppose Amy earns $575 per week working as an interior designer for Ourhouse. She uses $10 to take a yoga class at Big Bend. Big Bend pays Van $400 per week to instruct yoga. Van uses $150 to purchase furniture from Ourhouse. Identify whether each of the following events in this scenario occurs in the factor market or the product market. Factor Market Product Market Event Van earns $400 per week working for Big Bend. Amy earns $575 per week working for Ourhouse. Amy spends $10 to take a yoga class. Which of the elements of this scenario represent a flow from a firm to a household? This could be a flow of dollars, inputs, or outputs. Check all that apply. ✔The $400 per week Van earns working for Big Bend The $150 Van spends to purchase furniture from Ourhouse Amy's labor O The yoga class Amy receives
The figure depicts the market for shoes. Suppose that a less expensive material for making shoes is developed. a. What effect will this event have on supply and demand in the shoe market? Demonstrate your answer graphically. Instructions: Use the tool provided 'New line' to draw either a new demand or supply curve that reflects the market effect of this event. Plot only the endpoints of the line. Market for Shoes Tools New line Q Quantity of shoes b. If a less expensive material is developed, the (Click to select) (Click to select) v v will This will cause the equilibrium price to (Click to select) v and the equilibrium quantity to (Click to select) v Price ($)
What is the effect of an increase in the number of people working at home on the market for deodorant, all else equal? Show and explain the impact on Dx, Sx, P, Qdx, and/or Qsx assuming a competitive market for deodorant.
Based on this model, firms earn revenue when Suppose Teresa earns $750 per week working as a pilot for Wingies. She uses $10 to take a yoga class at Big Bend. Big Bend pays Sam $475 per week to instruct yoga. Sam uses $350 to purchase international flights from Wingles. Event purchase Identify whether each of the following events in this scenario occurs in the factor market or the product market. Sam earns $475 per week working for Big Bend. Teresa spends $10 to take a yoga class. Teresa earns $750 per week working for Wingies. Factor Market Product Market in product markets. The $475 per week Sam earns working for Big Bend O Teresa's labor Which of the elements of this scenario represent a flow from a household to a firm? This could be a flow of dollars, inputs, or outputs. Check all that apply. The yoga class Teresa receives The $350 Sam spends to purchase international flights from Wingies
The following graph shows the demand curve for uff, a useful commodity produced on the planet Hermes. The Hermetian currency is the yen. The graph input tool also shows how demand for uff is affected by changes in the average income of Hermetians, as well as the prices of tulg and snick, two other related goods available on the planet. Suppose that the price of a gram of uff decreased from 50 yen to 45 yen. This would cause a _______ (options: movement along, shift of) the demand curve and therefore an increase in _________ (options: the demand for uff, the quantity of uff demanded). Plug any value lower than the current number into the Average Income box. A decrease in average income causes a leftward _________ (options: movement along, shift of) the demand curve.
5. The circular-flow model The following diagram presents a circular-flow model of a simple economy. The outer set of arrows (shown in green) shows the flow of dollars, and the inner set of arrows (shown in red) shows the corresponding flow of inputs and outputs. Markets for Goods and Services Firms Households Markets for Factors of Production Based on this model, households earn income when households v purchase resources in markets for factors of production. Suppose Frances earns $625 per week working as an analyst for A-Plus Accountants. She uses $9 to have breakfast at Dinah's Diner. Dinah's Diner pays Dmitri $250 per week to work as a short-order cook. Dmitri uses $275 to purchase tax services from A-Plus ACcountants.
Suppose Teresa earns $875 per week working as a corporate attorney for Rowan and Martin Associates. She uses $9 to order a mojito cocktail at Little Havana. Little Havana pays Sam $350 per week to wait tables. Sam uses $200 to purchase legal service from Rowan and Martin Associates. Identify whether each of the following events in this scenario occurs in the factor market or the product market. Event Factor Market Product Market Sam spends $200 to purchase legal service from Rowan and Martin Associates. Teresa earns $875 per week working for Rowan and Martin Associates. Teresa spends $9 to order a mojito cocktail. Which of the elements of this scenario represent a flow from a firm to a household? This could be a flow of dollars, inputs, or outputs. Check all that аpply. O Teresa's labor O The $350 per week Sam earns working for Little Havana O The mojito Teresa receives O The $200 Sam spends to purchase legal service from Rowan and Martin Associates
Consider how health insurance affects the quantity of healthcare services performed. Suppose that the typical medical procedure has a cost of $100, yet a person with health insurance pays only $20 out of pocket. Her insurance company pays the remaining $80. (The insurance company recoups the $80 through premiums, but the premium a person pays does not depend on how many procedures that person chooses to undertake.) Draw the demand curve in the market for medical care. (Include the horizontal axis should represent the number of medical procedures.) Show the quantity of procedures demanded if each procedure has a price of $100. On your diagram, show the quantity of procedures demanded if consumers pay only $20 per procedure. If the cost of each procedure to society is truly $100, and if individuals have health insurance as described above, will the number of procedures performed maximize total surplus? Explain. Economists often blame the health insurance system for excessive use of…
Assuming hypothetical equilibrium in Demand/Supply Model of Apples, illustrate impact of following events:Suppose the Doctors recommend eating Apples every morning. The Monsoon rains adversely affect the Apple Harvest. The government announces increase in Wages of workers. The price of petrol in the market comes down. Consumers Income falls during government imposed Lockdowns due to health concerns. Given below is the Supply Schedule of Nestle Milk per liter:Price of Milk per liter (in Rs) 100 200 300 400Quantity Supplied per day in liters (in 1000s) 100 200 300 400Use the above data to illustrate the Supply Curve in a graph with complete labels. Assume Rs. 200 is the original price of milk per liter and 200,000 liters is the original quantity of supply. Suppose the price rises from Rs. 200 to Rs. 300, what will be the amount of Quantity Supplied?Illustrate the impact of (C) on the graph. Is this a movement along the supply curve or shift of the curve?
Victoria is the food basket for Australia. In 2017, Victoria witnessed a severe drought that is reported to be the worst in many years. Assume all factors constant meaning that there is no external influence in the market except the drought. Use the demand and supply model figure below to explain the impact of the drought on food supply to Northern Territory, a state that relies on food supplies from Victoria.
Discuss the two main types of related goods according to demand and supply analysis