Answer
Please see the graphs.
Work Step by Step
Please see the circular flow diagrams for each question. The areas highlighted in orange are the parts of the model that are in action.
a)
A household spending money on milk brings revenue to the firm and results in goods sold by the firm.
b)
A household providing labor provides a factor of production, and the firm pays wages (income) to the household.
c)
A household spending money on a haircut provides revenue to the firm (in exchange for services provided).
d)
A household providing capital to a firm will receive part of the profits from the firm. That household realizes the profits as income.
