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STA 3032 Study Guide - Delaware Route 1


Department
Statistics
Course Code
STA 3032
Professor
Dr.Mike

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1 Using the model provided in the lesson, draw (by hand) and label the circular
flow for the islands' economy. Make sure to include all sectors.
2 Explain how money (increased commerce) spent by tourists in the Macro
Islands moves through the economy's circular flow diagram (in fewer than 150
words). Make sure that each market and the government are included in your
explanation.
The revenue brought into the Macro Islands from the tourists first impacts the
product market which affects the firms receive this as an income. After this the
Government takes the business taxes which in turn allow for government services
for he firms. Firms may then borrow money and pay interests to a financial
market. This income also allows for the resource market to provide the firms
resources through business costs to produce goods and services, which affects the
households. The households then receive income from the resource market and
again the government takes personal taxes also allowing for government services
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