ICSE Class 9 Answered
Explain
the dual role played by households and firms in an economy.
Asked by Topperlearning User | 05 Jun, 2015, 09:02: AM
Expert Answer
The firms are production units. They collect different factors of production and produce different types of goods. The dual roles played by the firms are:
- They produce and sell different products in exchange of product-prices.
- They purchase different factors of production by paying factor-prices to the owners of those factor services.
Households are consumption units. The dual roles played by the households are:
- They purchase different consumer goods for self-consumption and pay prices for these goods.
- They are also the owners of different factors of production and sell these factors to the firms. They earn factor income for supplying these factors.
Answered by | 05 Jun, 2015, 11:02: AM
ICSE 9 - Economics Applications
Asked by eee | 01 Sep, 2023, 09:01: PM
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