Question

which of the following is true according to the circular flow model? *
firms are suppliers in both the product and factor markets.
firms are demanders in the resource markets and suppliers in the product markets.
households are demanders in both the resource and factor markets.
households are demanders in the resource markets & suppliers in the product markets.
the private sector is made up of the households, firms, and the government.

a mechanic that leaves his job working on cars and is currently looking for * a job working on planes is considered
a. frictionally unemployed
b. seasonally unemployed
c. structurally unemployed
d. cyclically unemployed
e. not in the labor force

Explanation:

For the first question: The circular flow model shows that firms purchase resources (like labor) from households in the resource/factor market (acting as demanders) and sell goods/services to households in the product market (acting as suppliers). Other options are incorrect: firms are not suppliers in factor markets, households are suppliers in resource markets, and the private sector does not include government.
For the second question: Frictional unemployment occurs when workers are temporarily between jobs while searching for a new role that matches their skills. The mechanic is transitioning between similar jobs, so this fits frictional unemployment. Seasonal unemployment is tied to seasonal work, structural is due to skill mismatches, cyclical is from economic downturns, and the mechanic is actively seeking work so they are in the labor force.

Answer:

1. Firms are demanders in the resource markets and suppliers in the product markets.
2. A. Frictionally unemployed