Which line represents the flow of final goods and services?
1 answer:
The Household line represent the flow of final goods and services and consumer spending while the Business line represent the flow of rent, wages, interest, and profits.
<h3>What is the circular flow diagram?</h3>This is an economic diagram that illustrate the flow of money through the economy.
The four parts of the circular flow diagram includes:
- individuals,
- firms,
- market for goods and services,
- market for factors of production.
In conclusion, these economic diagram illustrates the system functions through the interactions of households and firms.
Read more about circular flow diagram
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Answer: The current book value of an equipment purchased three years ago is $6983.925 .
There are two ways to solve this question.
<h3>Method 1</h3>In this method, we compute the depreciation for each of the three years and deduct the total depreciation calculated from the purchase value of the equipment to arrive at the book value of the equipment.
Equipment Value: $94,250
Year MARCS Depreciation Rate Depreciation
1 0.3333
2 0.4445
3 0.1481 <u> </u>
Total 87266.075
Value at the end of year 3 is $94,250 - 87266.075 = 6983.925
<h3>Method 2</h3>In this method, we add up the depreciation rates and deduct from 1. We then find the product of this number and the cost of the equipment to arrive at the current book value.