In this Circular Flow example if shifts in Supply and Demand (driven by \"choice
ID: 1165505 • Letter: I
Question
In this Circular Flow example if shifts in Supply and Demand (driven by "choices") change the "Average Price" to $1.00 then the total dollar value of Goods and Services produced would be 2,500 Units Goods & Services Product Business Revenues Consumption Spending $5,000 $5,000 NE Business Households $5,000 Factor Payments Factors of Production $5.000 Income Factor Markets Factors of Production Land, Capital, Entrepreneurship,& LABOR 120 People LABOR, Land, Capital &Entrepronourship; 125 People Answers: 1. $3000 2. $6000 3. $2500 4, $7500Explanation / Answer
When the average price changes to $1 then the value of goods and services would be $2500. Here due to shift in demand-supply average price changes to $1 and as a result of this total value of goods and services would be 2500*$1 = $2500. So the answer will be 3.