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4 March, 11:20

Jim is being paid $7.25 an hour to work at a restaurant. In the circular flow, this is an example of a:

household selling a resource in the factor market.

household buying goods and services in the factor market.

household buying goods and services in the product market.

business selling goods and services in the product market.

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  1. 4 March, 13:24
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    The answer is household selling a resource in the factor market which is the same thing as business buying resource in the factor market

    Explanation:

    Factor market is a market in which factors of production e. g land, capital, labor are bought and sold.

    In the question above, Jim (household or labor) is working at a restaurant (firm or business). This means Jim is selling his resource (labor) in the factor market while the restaurant is buying the resource (labor) in the factor market.
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