Question

Which of the elements of this scenario represent a flow from a household to a firm? This could be a flow of dollars, inputs, or outputs. Check all that apply.

Answer 1

Answer:

The flow is in the form of inputs and then dollars in a sequence.

Explanation:

(1) The household supplies factor input services in the form of labor to the firm.

(2) The labor produces goods and services for the firm.

(3) The firm pays wages to the labor in return for the produce.

(4) The households buy the goods and services of the firm.

(5) For the goods and services offered, the firm takes dollars from the households.

Hence, the entire above process emphasizes a flow in the form of inputs and then dollars from the household to the firm for the output purchased by it from the firm.