The Circular Flow Matrix (YouTube video: https://www.youtube.com

What is the circular flow matrix or model?

• A type of computer program used in market economies

• A diagram showing how products, resources, and money flow in the economy

• A type of currency used in international trade

• A mathematical equation used to calculate GDP

Where do businesses sell goods and services to households?

• Product market

• Resource market

• Labor market

• Stock market

What are the four categories of resources in the circular flow matrix?

• Food, Clothing, Shelter, Transportation

• Gold, Silver, Bronze, Copper

• Water, Air, Fire, Earth

• Land, Labor, Capital, Entrepreneurship

What is the term for the money households pay for goods and services in the product market?

• Business spending

• Investment spending

• Government spending

• Consumer spending

What do businesses demand in the resource market?

• Resources

• Money

• Goods and services

• Labor

What role does the government play in the circular flow matrix?

• Buys goods and services, buys resources, provides public goods and services, taxes businesses and households

• Produces goods and services, produces resources, provides public goods and services, gives loans to businesses and households

• Sells goods and services, sells resources, provides private goods and services, gives subsidies to businesses and households

• Imports goods and services, imports resources, provides public goods and services, gives grants to businesses and households

What is the term for the money the government pays to businesses or households without receiving goods or services in return?

• Subsidies

• Welfare payments

• Interest payments

• Transfer payments

What is the financial sector responsible for in the circular flow matrix?

• Investing in businesses and households

• Producing and distributing resources

• Buying and selling goods and services

• Saving and loaning out money

What is the main objective of the government providing subsidies and welfare?

• Maximize profits and minimize costs

• Alleviate poverty and promote specific activities

• Increase government revenue and reduce spending

• Control the market and limit competition

What is the main difference between the public sector and the private sector in the circular flow matrix?

• Public sector includes government and business activities, private sector includes household activities

• Public sector includes household activities, private sector includes government and business activities

• Public sector includes government activities, private sector includes household and business activities

• Public sector includes business activities, private sector includes government and household activities