Explain the structure of the circular flow model
What will be an ideal response?
Households own the factors of production and sell the services from them to firms in the factor market. Income earned by households in the factor market is used to purchase goods and services from firms in the goods market. And the revenue the firms gain by selling the goods and services in the goods market is used to pay for the services of the factors of production they hire in the factor markets.
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The U.S. balance of trade: a. typically is positive since the United States exports far more goods than it imports. b. is the difference between merchandise exports and merchandise imports
c. includes net military transactions. d. Both b. and c. are correct.
State the law of diminishing returns. How do diminishing returns differ from diseconomies of scale? Be sure to define diseconomies of scale in your answer
What will be an ideal response?