1. Describe the role played by the following economic sectors: o
They own the factors of production, which they supply to the market.
The basic macroeconomic sector that includes the entire, wants and-needs-satisfying population of the economy. The household sector is the eating, breathing, consuming population of the economy. In a word "everyone," all consumers, all people. This sector includes everyone seeking to satisfy unlimited wants and needs.
Members of the household sector also own all of the factors of production, all resources. Every resource, every worker, every factory, every acre of land, every risk-taking entrepreneur is owned by someone in the household sector.
The business sector or corporate sector is "the part of the economy made up by companies".
The business sector includes the profit-motivated firms that engages in the production of goods and services. These firms combine the services of the four factors of production, which they acquire from the household sector, to pursue their productive activities. The primary reason for the existence of the business sector is to produce the goods that satisfy the wants and needs of the household sector.
The government sector includes all levels of government--federal, state, and local. These three levels intervene in the economy by collecting and spending tax revenue and by establishing and enforcing laws, rules, and other regulations. The government sector undertakes this intervention because society has deemed that the provision of some goods and services are better handled by the imposition of government than by voluntary market decisions.
Includes anything and everything that lies beyond the borders of a nation. The primary role it plays in the domestic economy is foreign. The domestic household, business, and government sectors purchase imports produced in the foreign sector. The foreign sector then buys exports...
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