Wednesday, September 21, 2016

Circular Flow Cheat Sheet

Circular Flow Cheat Sheet

Circular Flow is tested in the Macro Exam. 
I have yet to find a Micro Exam question about circular flow.
Since it is listed in the AP Micro curriculum you should still understand.

2000 AP Macro
Answer - (D) Households are demanders in the product market and suppliers in the factors market.
Households Demand Goods & Services and supply Land, Labor, & Capital, FOP.

1995 AP Macro
Answer - (D) II & III
Households sell factor services to Firms. (Land, Labor, Capital)
Households buy outputs from Firms. (Goods & Services)

2005 AP Macro

Answer - (E) Savings (Paradox of Thrift)

Paradox of Thrift in 60 Seconds

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