ECO 2114 Study Guide - Midterm Guide: Labour Force Survey, Progressive Alliance Of Socialists And Democrats, Marginal Revenue Productivity Theory Of Wages

• School: University of Ottawa
• Department: Economics
• Course: ECO 2114
• Professor: David Gray

Document Summary

Circular-flow diagram: the global economy is divided into 3 types of markets. These 3 interlocking & interacting markets are components of the circular flow model of the macroeconomy. Output markets, input markets, & money markets: actors: households & firms (also government & foreign sector, flows: income & expenditure (flow = x/unit of time, e. g m4g/s is at 12:00 and firms is at. Markets for goods/services (m4g/s), households buy & firms sell. Markets for the factors of production (m4fop), households sell & firms buy: inner loop = income flow, flows of inputs & outputs. M4g/s g/s bought houses inputs m4fop fop firms g/s sold: outer loop = expenditure flow, flow of $ M4g/s spending (gdp) houses income (gdp) m4fop wages, rent, profit (gdp) firms revenue (gdp) Labour markets: 3 primary factors of production (input market): land, labour (l), & capital (k)