The Circular Flow Diagram traces the flow of resources between households and Business Firms. Set up the diagram and illustrate how the flow of resources, payments for the resources, the production of goods and services, and the expenditures for these goods and services flow through the economy.

Short Answer Problems (5 Points each)
1.) The Circular Flow Diagram traces the flow of resources between households and Business Firms. Set up the diagram and illustrate how the flow of resources, payments for the resources, the production of goods and services, and the expenditures for these goods and services flow through the economy.
2.) Define Supply and Demand. Draw a Supply and Demand Curve indicating what the axis (Y and X) units are. Distinguish between a change in Demand and a change in Quantity Demanded. Give 2 shift factors for Demand and 2 shift factors for Supply.
3.) Define and give an Example of a Positive Economic Statement and a Normative Economic Statement.