Question: Lets put dollar amounts on the flows in the circular flow diagram of Figure 2.2. a. Suppose that businesses buy a total of $100 billion

Let’s put dollar amounts on the flows in the circular flow diagram of Figure 2.2.

a. Suppose that businesses buy a total of $100 billion of the four resources (labor, land, capital, and entrepreneurial ability) from households. If households receive $60 billion in wages, $10 billion in rent, and $20 billion in interest, how much are households paid for providing entrepreneurial ability?

b. If households spend $55 billion on goods and $45 billion on services, how much in revenues do businesses receive in the product market?

Step by Step Solution

★★★★★

3.49 Rating (172 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

a 10 billion for entrepreneurial ability 100 bi... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Document Format (2 attachments)

1438_6054778b13011_652044.pdf

180 KBs PDF File

1438_6054778b13011_652044.docx

120 KBs Word File

Students Have Also Explored These Related Microeconomics Principles Questions!

On January 1, 2013, the following information was drawn from the accounting records of Wilson Company: cash of $200; land of $1,800; notes payable of $600; and common stock of $1,000. Required a....

On January 1, 2013, the following information was drawn from the accounting records of Craven Company: cash of $800; land of $3,500; notes payable of $1,600; and common stock of $1,000. Required a....

On January 1, 2014, the following information was drawn from the accounting records of Wilson Company: cash of $200; land of $1,800; notes payable of $600; and common stock of $1,000. Required a....

1) Let's put dollar amounts on the flows in the circular flow diagram below. FIGURE 2-2 The Circular Flow Diagram Factors of production flow from households to businesses through the factor market,...

4. Lets put dollar amounts on the flows in the circular flow diagram of Figure 2.2 . LO5 a. Suppose that businesses buy a total of $100 billion of the four resources (labor, land, capital, and...

4. Lets put dollar amounts on the flows in the circular flow diagram of Figure 2.2. LO2.5 a. Suppose that businesses buy a total of $100 billion of the four resources (labor, land, capital, and...

Lets put dollar amounts on the flows in the circular flow diagram of Figure 2.2. LO5 a. Suppose that businesses buy a tfo t$al1 0o0 billio n of the four resources (labor, land, capital, and...

1) Potatoes cost Janice $0.50 per kilogram, and she has $6.00 that she could possibly spend on potatoes or other items. If she feels that the first kilogram of potatoes is worth $1.50, the second...

3. Let us put dollar amounts on the flows in the circular flow diagram of Figure 2-2. [LO2.5] a. Suppose that businesses buy a total of $100 billion of the four resources (labour, land, capital, and...

'1'\" 1. Let's put dollar amounts on the ows in the circular ow diagram below. a. Suppose that businesses buy a total of $100 billion of the four resources (labor, land, capital, and entrepreneurial...

Find the default risk premium for a debt security given the following information: inflation premium 2.5 percent, maturity risk premium = 2.5 percent, real rate = 3 percent, liquidity premium = 1.5...

Determine how each of the following expenses would be deducted for tax purposes. If the expense is not deductible, explain why not. a. Chander paid $500 in interest on a loan he used to purchase...

Question 6 1 pts Susie, who is 1 6 weeks pregrant, is having mild cramps with persistent and excessive bleeding. Upon examination you find that some portion of the products of conception ( placental...

*14. Why is the sample r alone sufficient for adequate interpretation when the sample size is quite large (say over 300 or 400 cases), whereas an interval estimate is recommended for smaller samples?

Use the circular flow diagram to show how each of the following government actions simultaneously affects the allocation of resources and the distribution of income: a. The construction of a new high...

What do economists mean when they say government purchases are exhaustive expenditures whereas government transfer payments are nonexhaustive expenditures? Cite an example of a government purchase...

What is the most important source of revenue and the major type of expenditure at the Federal level? At the state level? At the local level?

9. Describe the characteristics of a variance covariance matrix. Also, explain how to read a variance-covariance matrix, what the individual values in a variance-covariance matrix represent, and what...

please answer all the sub Q at one time. I will post this question many times. Question 1 (14 marks) Call centers play an important role in managing day-to-day business communications with customers....

Emperors Clothes Fashions can invest $6 million in a new plant for producing invisible makeup. The plant has an expected life of 5 years, and expected sales are 7 million jars of makeup a year. Fixed...