Microeconomics Essay Example | Topics and Well Written Essays - 250 words - 4

Microeconomics - Essay ExampleThis relationship is repetitive making the circular flow unceasing. The harvest-feast foodstuffplace refers to where all the goods produced by the self-colored are sold to households while factor market is where all factors of action like labour, capital and land among others are traded (McEachern 5).Households sell resources or factors of production in the factor market and use the money obtained to purchase products sold by the firm in the product market. My family as a household provides labour to the firm. The family is then rewarded for the labour it sells to the firm through wages and salaries. After payment, the family uses the payment from the firm to purchase goods manufactured by the firm, hence the firm gets proceeds from sales of products. This money obtained from the family through product purchase is again used to purchase raw materials for producing goods and also used to pay workers (my family). This relationship is continuous resul ting into an endless circular flow pattern of