ECS1601 Assignment 8 2024 -
DUE 12 November 2024
, Question 1
Which of the following best describes natural resources?
a. They can be replaced.
b. They are unlimited in supply.
c. They are remunerated by rent.
d. They consist of machines, buildings, and tools.
Answer: c. They are remunerated by rent.
Explanation: Natural resources are generally remunerated by rent, which distinguishes
them from capital goods like machines, buildings, and tools, which yield different types
of returns. Rent is the income typically earned from the use of natural resources such as
land, minerals, and forests.
Question 2
Which of the following statements about the circular flow of production, income, and
spending is/are true?
(1) Firms are sellers in the factor market and buyers in the goods market.
(2) In the real sector, both factors of production and goods and services are traded.
(3) In the circular flow of economic activity, the financial sector operates independently
of the real sector.
(4) Households are both sellers and buyers in the flow of economic activities.
a. (1) (4)
b. (4)
c. (1) (3) (4)
d. (2) (3)
Answer: a. (1) (4)
Explanation: Firms are typically sellers in factor markets, where they offer goods and
services, and buyers in goods markets, where they acquire factors of production.
Households participate as both buyers and sellers in the economy—they supply factors
of production (like labor) and purchase goods and services.
DUE 12 November 2024
, Question 1
Which of the following best describes natural resources?
a. They can be replaced.
b. They are unlimited in supply.
c. They are remunerated by rent.
d. They consist of machines, buildings, and tools.
Answer: c. They are remunerated by rent.
Explanation: Natural resources are generally remunerated by rent, which distinguishes
them from capital goods like machines, buildings, and tools, which yield different types
of returns. Rent is the income typically earned from the use of natural resources such as
land, minerals, and forests.
Question 2
Which of the following statements about the circular flow of production, income, and
spending is/are true?
(1) Firms are sellers in the factor market and buyers in the goods market.
(2) In the real sector, both factors of production and goods and services are traded.
(3) In the circular flow of economic activity, the financial sector operates independently
of the real sector.
(4) Households are both sellers and buyers in the flow of economic activities.
a. (1) (4)
b. (4)
c. (1) (3) (4)
d. (2) (3)
Answer: a. (1) (4)
Explanation: Firms are typically sellers in factor markets, where they offer goods and
services, and buyers in goods markets, where they acquire factors of production.
Households participate as both buyers and sellers in the economy—they supply factors
of production (like labor) and purchase goods and services.
