![]() The monetary payments in the product market are generally called sales. They purchase resources in the factor market and sell goods and services in the product market. When a business makes a profit, that money goes to the owner of the business to pay for his or her entrepreneurship.īusinesses are the producers of goods and services in the circular flow model. ![]() Payment for entrepreneurial talent is called profit. AP Macroeconomics focuses on the principles that apply to an. That is because physical capital is often financed through loans requiring interest payments. Each course corresponds to one semester of a typical introductory college course in economics. Payments for capital are referred to as interest. The payments for land are generally called rent payments for labor are called wages. Households exchange resources for monetary payments. Those resources include land, labor, capital, and entrepreneurship. Households are the owners of resources in the circular flow model. ![]() The CED was updated in the summer of 2022 to incorporate the change to the calculator policy for the exam. It clearly lays out the course content and describes the exam and AP Program in general. This is the core document for the course. More detailed circular flow diagrams include the government, foreign markets, banking systems, etc., but that is more detail than you generally need to know for an introductory course. AP Microeconomics Course and Exam Description. In the simplified circular flow diagram, there are just two economics actors: businesses and households.
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