Exhibit 1.2

-Refer to the circular-flow model in Exhibit 1.2. Households supply ________ to firms through resource markets.
A) goods and services
B) products
C) labor, capital, natural resources, and entrepreneurial ability
D) guidance
E) wages, interest, rent, and profit

Question

Exhibit 1.2
 
-Refer to the circular-flow model in Exhibit 1.2. Households supply ________ to firms through resource markets.
A) goods and services 
B) products 
C) labor, capital, natural resources, and entrepreneurial ability 
D) guidance 
E) wages, interest, rent, and profit

Quizplus · Accepted Answer

Households supply various factors of production (labor, capital, natural resources, and entrepreneurial ability) to firms through resource markets in order to produce goods and services. Wages, interest, rent, and profit are payments made by firms to households in exchange for these factors of production.

Exhibit 1.2 -Refer to the Circular-Flow Model in Exhibit 1.2. Households Supply