The economy can be represented by economic models. One of the models we use to understand the economy is a “Circular Flow Diagram”. Sketch a Circular flow model and explain the flow of money and flow of goods and services and factors of production caused by the following activities. Sana spends Rs.500 on a haircut.  Mustafa receives Rs.200,000 from his 10 per cent ownership of Salman Chemicals Ltd.

Q: In the circular flow model, firms own the economic resources and households buy the manufactured…

A: Firms and household are the two players in the circular flow model.

Q: Draw a Circular-Flow diagram. Identify the parts of the model that correspond to flow of goods and…

A:

Q: Which of the following are myths about the U.S. economy? Check all that apply. A. The United States…

A: The tax revenue in America is around 24% of GDP and America is the largest consumer market.

Q: Explain how , in the basic Circular Flow diagram, households and firms can be thought of as both…

A: In financial aspects, the circular flow diagram outline addresses the association of an economy in…

Q: What is the Circular Flow model? What are the main components of the model? What each market in the…

A: Circular flow of income is the process where the creation and flow of the money generated and its…

Q: According to the principle of , consumers determine what is produced in the economy through their…

A: Consumer behavior is the study of what motivates people and businesses to buy particular things and…

Q: Give an economic relationship in which individual effect of independent variables are difficult to…

A: Classical Linear Regression Model (CLRM) is the basic regression model which lays the foundation of…

Q: Economy can be represented by economic models. One of the models we use to understand economy is a…

A: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question and…

Q: Why do economists use models? to learn how the economy works to attract the attention of government…

A: Answer: Correct option: A (to learn how the economy works) Explanation: Models help in telling the…

Q: Discuss the importance of studying Macroeconomics?

A: The macro economics considers the dynamic of the whole economic such as national output, inflation,…

Q: classical and Keynesian economists

A: The biggest disagreements in macroeconomics are related to the economic philosophy.

Q: What are the important problems that constitute the subject matter of macroeconomics? Briefly…

A: Meaning of Macroeconomics: Macroeconomics refers to the study of economic problems or economic…

Q: What is macro-economics and is it important in the economy of a country?

A: Macro economics is the study of economy as a whole. It takes into consideration the entire economy…

Q: The economy of a hypothetical country has been stable for two or three years with very low…

A: The Gross Domestic Product (GDP) measures the market value of all the final goods and services…

Q: Explain with graphics) A consumer, who is initially a lender, remains a lender even after a decline…

A: Even if interest rates fall, a customer who was formerly a lender remains a lender.  This customer…

Q: what is Law of economy

A: The construction of a general truth based on specific observations or tests that traces out a causal…

Q: im taking a macroeconomics course and we are working on free graphs I need some help writing a…

A: Real GDP is the worth of goods and services generated by an economy in a given period that has been…

Q: What are leading economic indicators? Why are they important? In what way are these variables…

A: A macroeconomic gauge used by researchers to analyze current and future economic activity and…

Q: In the circular-flow diagram households receive money for ______ in the ______  market?

A: A circular flow diagram shows that how goods, services, and income move through the economy. In a 2…

Q: why is the economy not self-correcting? What can be done about it?

A: The principle that if economy is left to its own devices is called self-correcting. When an economy…

Q: 1.      Draw a circular-flow diagram. Identify the parts of the model that correspond to the flow of…

A: Circular flow: The circular flow explains the process that determines the national income and…

Q: A consumer, who is initially a lender, remains a lender even after a decline in interest rates. Is…

A: Microeconomics is a part of economics that is used to understand how resources can be allocated in…

Q: State the three possible relationships between production, income and spending in macroeconomic…

A: The connection between production, income and spending is frequently called a utilization plan. It…

Q: According to classical economic theory, there is an invisible hand in the economy. What is it? And

A: The concept of the "invisible hand" was explained by Adam Smith in his 1776 classic foundational…

Q: Draw a circular-flow diagram. Identify the parts of the model that correspond to the flow of goods…

A: The circular flow diagram representing flow of goods and services and flow of factors of production…

Q: Give the (2) different types of economy. Explain each type.

A: Economy is a system of all those arrangement and activities in which individuals, or group wants to…

Q: How to classify goods as consumption goods and capital goods? Is there any specific way to do so?

A: If the good is capable of satisfying the human wants directly then it is referred to be as…

Q: Question According to Stiglitz "it is better to be a cow in Europe than to be an average person in…

A: The income inequalities are rising rapidly across the world. The developing countries are far behind…

Q: Define economy

A: Economics studies how resources are allocated in a manner that most of the human wants are met. A…

Q: Which of the following is not an “acronym” economy?

A: An acronym is a word shaped by contracting an expression by joining specific letters of words in the…

Q: how macrosystematics work

A: Macro systematics is a hedge or mutual fund strategy on the basis of their holdings in a portfolio…

Q: Explain the importance of the study of "macroeconomics ?

A: According to the given question Relatively stated that the study of macroeconomics is very important…

Q: The circular flow model explains how consumers and producers interact in an economy.

A: The two-sector circular flow model explains how the firms and the households interact with each…

Q: Economy can be represented by economic models. One of the models we use to understand economy is a…

A: (b) Economy can be represented by economic models. One of the models we use to understand economy is…

Q: conomy can be represented by economic models. One of the models we use to understand economy is a…

A: Circular-flow of income The circular flow or circular-flow of income is a model of the economy in…

Q: How might a theory of the economy differ from a description of that economy.

A: The theory of the economy and the description of that economy affect each other. The theory of the…

Q: What is the difference between macro and microeconomics? Answer your question with example (s).

A: Microeconomics and macroeconomics are two broad branches of economics. The difference between them…

Q: With the aid of the diagram, describe the four major sectors in an economy according to the…

A: The large set of activities of consumption and production being interrelated that tend to determine…

Q: In terms of Islamic Economic, what is the Muslim Consumer Behavior and why it is related to the…

A: The behaviour of a consumer is a complex phenomenon that is influenced by multiple diverse forces…

Q: how does the circular flow model of  “incomes” and “expenditures” provide a foundation for economic…

A: The circular flow of income is an economic paradigm that represents the aggregate of market…

Q: Draw a circular-flow diagram for a four-sector economy. Identify the each part of the model that…

A: We explain the concept of circular flow of income using the following digram.