Final answer:
Box B on the circular flow model represents the product markets where firms sell goods and services to households. The correct option for the student's question is B. Product markets.
Step-by-step explanation:
In the circular flow model, box B usually represents the product markets. In these markets, firms sell goods and services that they produce to households. Here's how the model works:
- Firms produce and sell goods and services in the product market.
- Households pay for these goods and services, which generates revenue for the firms. This is what box B on the circular flow model indicates.
- Additionally, households provide labor and other resources to firms in the resource markets. In return, firms pay households for these resources, which provides the income that households then use to purchase goods and services in the product market.
Therefore, the correct answer to the question 'Which part of the economy is represented by box B on the circular flow model?' is option B. Product markets.