BUSINESS ADMINISTRATION
BUSINESS ECONOMICS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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product market
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factor market
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firms
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household
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Detailed explanation-1: -In the factor market, businesses are the buyers. They may buy, rent, or hire raw materials, land, or labor. Whatever a business needs in order to build, package, and deliver the products or services they provide must be obtained in the factor market. The sellers include producers of raw materials.
Detailed explanation-2: -The factors of production in an economy are its labor, capital, and natural resources. Labor is the human effort that can be applied to the production of goods and services. People who are employed or would like to be are considered part of the labor available to the economy.
Detailed explanation-3: -Wages, interest, rent, and profit flow from businesses to the resource market, becoming the flow of income from the resource market to the households. Land, labor, capital, and entrepreneurship flow from households through the resource market to the businesses.
Detailed explanation-4: -The purchase of goods and services occurs in the product market.