Exhibit 1.2 -Refer to the Circular-Flow Model in Exhibit 1.2.Households Supply ________

question 85

Multiple Choice

Exhibit 1.2

-Refer to the circular-flow model in Exhibit 1.2.Households supply ________ to firms through resource markets.

• A)goods and services
• B)products
• C)labor, capital, natural resources, and entrepreneurial ability
• D)resources
• E)wages, interest, rent, and profit

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Definitions:

Consumer Price Index

An index measuring the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services.

Base Year

The year with which other years are compared when an index is constructed: for example, a price index.

Minimum Wage

The lowest legal hourly pay for employees, set by government law.

Unskilled Workers

Workers who possess no special skills or training and typically perform simple tasks that require minimal prior experience.