Markets for Goods and Services Firms Households Markets for Factors of Productio
ID: 1134079 • Letter: M
Question
Markets for Goods and Services Firms Households Markets for Factors of Production Based on this model, households earn income when firms purchasefactors in factor markets. Suppose Yvette earns $675 per week working as a programmer for PC Pros. She uses $10 to get her car washed at Spotless Car Wash. Spotless Car Wash pays Sean $375 per week to wash cars. Sean uses $225 to purchase software from PC Pros. Identify whether each of the following events in this scenario occurs in the factor market or the product market. Market Product Market Event Sean spends $225 to purchase software from PC Pros. Sean earns $375 per week working for Spotless Car Wash. Yvette spends $10 to get her car washed Factor 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 car wash Yvette receives Yvette's labor The $375 per week Sean earns working for Spotless Car Wash The $225 Sean spends to purchase software from PC ProsExplanation / Answer
House hold offers factor services to firms and firms pay back to households for supplying factors.
Based on this model, households earn income when Firms purchase Factors in factor market.
Sean Spends $ 225 to purchase Software from PC Pros. : Product Market
Sean Earns $ 375 per week working for spotless Car Wash : Factor Market.
Yvette spends $ 10 to get her car washed: Product market.
Flow from a firm to a household:
The car wash Yvette receives
The $ 375 per week Sean earns working for spotless Car Wash.