203k views
2 votes
How are producers' payments for resources illustrated by the circular flow of the economy?

User Phury
by
6.2k points

1 Answer

3 votes
The illustration in a circular flow of economy gives a simple presentation among four factors: households; goods and services market; firms; and factor markets.

Intervening factors of labor, capital, land, etc. are found in between firms and factor markets and also found in factor markets and households.

The finished product is a creation of the firms, goods and services market; also the households, and goods and services.

I think the payments for resources sets in the capital relationship between firms and factor markets.
User Tobias Schulte
by
6.5k points