Chapter 2
52. In the resource market, A. businesses borrow financial capital from households. B. businesses sell services to households. C. households sell resources to businesses. D. firms sell raw materials to households.
C
52. The simple circular flow model shows that A. households are on the buying side of both product and resource markets. B. businesses are on the selling side of both product and resource markets. C. households are on the selling side of the resource market and on the buying side of the product market. D. businesses are on the buying side of the product market and on the selling side of the resource market.
C
52. The two basic markets shown by the simple circular flow model are A. capital goods and consumer goods. B. competitive and regulated. C. product and resource. D. household and business.
C
88. Households and businesses are A. both buyers in the resource market. B. both sellers in the product market. C. sellers in the resource and product markets respectively. D. sellers in the product and resource markets respectively.
C
52. In the simple circular flow model, A. households are buyers of resources. B. businesses are sellers of final products. C. households are sellers of final products. D. there are real flows of goods, services, and resources, but not money flows.
B
52. In what type of business do the owners bear no personal financial responsibility for the company's debts and obligations? A. partnerships B. corporations C. sole proprietorships D. in all of the businesses listed in the other answers
B
94. Which of the following best illustrates the circular flow model in action? A. Bobbie goes to work and builds cars; she uses the income she receives to buy food at the grocery store. B. Evan buys a new couch; the owner of the furniture store uses some of the money from the sale to pay her supplier and uses the rest to take her family out to dinner. C. Boeing experiences a surge in orders for new airplanes, prompting the company to hire more workers. D. All of these answers illustrate the workings of the circular flow model.
D