(1) The Core Actors in a Market Economy
Circular Flow, Households, Firms, Output Market, Goods Market, Input Market, Factor Market
This introduces households and firms as the primary actors in the economy. It also introduces the concepts of output and input markets. The roles of households and firms in each of these market types is explained. All of this is illustrated using a simple circular flow diagram.
Crane, Steven E., "(1) The Core Actors in a Market Economy" (2011). Principles of Microeconomics. 22.
Ability to distinguish between households and firms, and their roles in the economy. Ability to distinguish between output and input markets, and to discuss the respective roles of households and firms in each of these markets.