2. The circular-flow model The following diagram presents a circular-flow model of a simple economy. The outer set of arrows (shown in green) shows the flow of dollars, and the inner set of arrows (shown in red) shows the corresponding flow of inputs and outputs. Markets for Goods and Services Firms Households Markets for Factors of Production Based on this model, households earn income when households purchase goods and services in factor markets. Suppose Susan earns $575 per week working as a corporate attorney for Rowan and Martin Associates. She uses $8 to buy a box of aspirin at Pillmart Pharmacy. Pillmart Pharmacy pays Raphael $425 per week to work the cash register. Raphael uses $250 to purchase legal service from Rowan and Martin Associates. Suppose Susan earns $575 per week working as a corporate attorney for Rowan and Martin Associates. She uses $8 to buy a box of aspirin at Pillmart Pharmacy, Pillmart Pharmacy pays Raphael $425 per week to work the cash register. Raphael uses $250 to purchase legal service from Rowan and Martin Associates. Identify whether each of the following events in this scenario occurs in the factor market or the product market. Event Factor Market Product Market Raphael earns $425 per week working for Pillmart Pharmacy Raphael spends $250 to purchase legal service from Rowan and Martin Associates. Susan earns $575 per week working for Rowan and Martin Associates. O 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 aspirin Susan receives The $250 Raphael spends to purchase legal service from Rowan and Martin Associates Susan's labor The $425 per week Raphael earns working for Pillmart Pharmacy