(Solved): 6. The circular flow model The following diagram presents a circular flow model of a simple econom ...

6. The circular flow model The following diagram presents a circular flow model of a simple economy. The outer set of arrows (shown in green) shows the flow of dollars, and the inner set of arrows (shown in red) shows the corresponding flow of inputs and outputs. Markets for Goods and Services Firms Households Markets for Factors of Production Based on this model, households earn income when firms purchase goods and services in the resource markets. Suppose Ana earns $550 per week working as a programmer for PC Pros. She uses $9 to order a mojito cocktail at Little Havana. Little Havana pays Yakov $350 per week to wait tables. Yakov uses $250 to purchase software from PC Pros. Identify whether each of the following events in this scenario occurs in the factor markets or the product markets. Event Factor markets Product markets Ana earns $550 per week working for PC Pros. Yakov spends $250 to purchase software from PC Pros. Ana spends $9 to order a mojito cocktail. Which of the elements of this scenario represent a flow from a firm to a household? This could be a flow of dollars, inputs, or outputs. Check all that apply. The work Ana does for Little Havana The $350 per week Yakov earns working for Little Havana The $250 Yakov spends to purchase software from PC Pros The mojito Ana receives