In the Circular-Flow Diagram, the Places Where Resources, Especially Capital

question 164

Multiple Choice

In the circular-flow diagram, the places where resources, especially capital and labor, are bought and sold are the:

• A) product markets.
• B) factor markets.
• C) households.
• D) firms.

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Definitions:

Product Costs

Costs directly associated with the manufacturing of products, including materials, labor, and factory overhead.

Financial Reporting

The process of producing statements that disclose an organization's financial status to management, investors, and the government.

Average Costs

The cost per unit of output, calculated by dividing total costs by the total number of units produced.

Variable Cost

Costs that fluctuate with the level of output or production, such as raw materials and direct labor.