Question

Which grouping gives the sectors into which the economy is better understood as being broken?

Options

• Services, labour types, rivalry, and business

• Agriculture, industry, one representative good, and prices

• Agriculture, industry, services, households, business, and government

• Households, output levels, employment levels, and government

Answer 1

The economy is better understood when broken into agriculture, industry, services, households, business, and government. This sectoral approach preserves differences in technologies, prices, and labour types.