February 7, 2018
Circular Flow
- Household: A person or a group of people that share an income.
- Firms: An organization that produces goods and services for sale.
- Factor (Resource) Market: The market in which the factors of production are brought by firms and sold by households.
- Product Market: Where goods and service are bought and sold.
- Factor Payments:
- Land - Rent
- Labor - Wages
- Capital - Interest
- Entrepreneurship - Profits
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