Mircoeconomics Assingment#5

Microeconomics

1. Using the typical "Facebook" lingo, write a definition for Microeconomics and then provide a standard English translation for your "Facebook" definition.

Mircoeconomics is a branch of economics that studies how the individual parts of the economy, the household and the firms, make decisions to allocate limited resources, typically in markets where goods or services are being bought and sold.

                                                                  Role of Money:
1. Using what you learned about the three functions of money, explain how "play money" differs from "real money"?

                    vs                                

Real money deals medium of exchange, store value, and unit of account. Play money does not, it is fake, it cant be used for any of these functions.

2. Money has no actual value other than the value we attach to it. The barter system would be practiced today if the participants did not agree to set a value on a piece of printed paper that represented the value of the goods and services they had to offer. What would you accept in place of money, if someone wanted to buy your most prized material possesion?

I would accept something that means almost the same to that person. Just like money, you get what you pay for and if it means that much to me, I want something that means the most to you.
                                                    Circular Flow Model - M11
1.)What does a circular flow model tell us?

Circular Flow refers to a simple economic model which describes the reciprocal circulation of income between producers and consumers.

2.) What is the role of households in the three sector circular flow model?

The role of households pay taxes to the government and the households gives the businesses labors and payments.

3. What is the role of businesses in the three sector circular flow model?

The role of the business is to pay taxes and give goods and services to the government .Business also gives income and goods and services to the households.

4. What is the role of government in the three sector circular flow model?

The government provides services and payments to the business and services and income to the households.
5. What role do households have in the factors or resource market (inputs)?

The households are the factor market