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Your response should be at least one paragraph, two to three sentences in length, and include the following.

  • Whether you agree or disagree with the findings and why
  • A probing question that facilitates further discussion of the topic
Collapse SubdiscussionTodd Gagnon

Todd Gagnon

Hi Class,

     The role in firms in a macroeconomy make up the industry section. Just as consumers directly effect the household industry. The household industry can be measured by things such as unemployment, or the amount of income they make.  Looking at the circular flow model, you can see at the microeconomic level how the exchange of resources for income in the resource market is made with businesses. Then following the flow, businesses exchange goods and servives for revenue in the product market. It is not possible for a firm to exist without households. Businesses would have no resources to make their products with, and they would have no one to sell their goods and services to in order to make revenues. Macroeconics is the study how different industry such as the household, government, and business industry make decisions that impact one another. An example is if the economy was entering into a recession, should the government increase their spending or provide tax cuts to stimulate the economy.

     The article I chose has to due with the 3rd bailout provided to the airline industry that was provided in the $1.9 trillion stimulus package. This bailout would prevent employee furloughs through a payroll support programme (PSP) (Airguide Business, 2021). The aid would go towards major airlines of the sum amount of $14 billion for assistance. I believe this type of government assistance is at the macroeconomic level as it is aiding the entire airline industry. Another option that the government could have done is to provide payments to furlough workers instead of a bailout to airlines. While this would have also helped the household industry, the airline industry being without the labor resources and not been able to maintain aircraft with the absences of labor resources. This would have crippled the airline industry and future travel in this country.



Collapse SubdiscussionRendon Corpuz

Rendon Corpuz


     Companies and firms play multiple vital roles in the flow of money throughout the world’s macroeconomy. Some of these involvements include obtaining resources for hiring/employments and providing services and goods for consumers. Additionally, consumers can have an indirect and major macroeconomic effect in terms of employment and spending money. Because macroeconomics addresses such topics in a much broader scale, the impact would be considered indirect. A broad and adequate interpretation of economic exchanges is displayed by the Circular Flow Model (see image as an aid). The Circular Flow Model analysis highlights the macroeconomic connotations (Investopedia, 2021).

     Using the Circular Flow Model supports the relationship between significant macroeconomic components. An article from the Corporate Finance Institute titled “Circular Flow Model” explains the specific categories of principal features and the economical influences of firms and households (which is emphasized by the model) (Corporate Finance Institute, 2021). The way money flows within the economy are influenced by both microeconomics and macroeconomics because income can fall into each of these categories. Through the application of microeconomics, although the more expansive effects can be analyzed in agreement with macroeconomics, the interactions among firms and households are highlighted. Evidently, based on the present straightforward connections, firms would be inoperable without households spending -– we, the consumers must spend for money to flow and firms to operate. Additionally, labor is an important component of production supported by the flows between households and firms.



Corporate Finance Institute. (2021, March 1). Circular Flow Model. https://corporatefinanceinstitute.com/resources/knowledge/economics/circular-flow-model/

Investopedia. (2021, February 9). Circular Flow Model. https://www.investopedia.com/terms/circular-flow-of-income.asp