Question

What about the role do households play in the labor market?

Group of answer choices

both suppliers and demanders

suppliers

demanders

neither suppliers or demanders

Answer 1

As we know that the households own the Factors of Production, and also consume the Goods and Serviced produced by the Firms.

The correct option is (a).

Both suppliers and demanders.

The households supply important factor of production that is labour and helps in production of goods. The households also demands goods to satisfy their wants.

If we talk about classical economics
Consisering a simple 2 sector economy households are both suppliers and firms as financial dealers of goods are demanders.

But firms are owned by households in that sense households both demand goods and supply labour.

Hope you got the answer.

Kindly comment for further explanation.

Thanks ?