Question

Observe the economic activities that take place in your locality and identify the interrelationship between different sectors

Answer 1

Answer:

hey mate here is your answer...All humans perform a variety of activities on any given day. There is work that we do every day and other activities we do for personal fulfilment and joy. So as a general rule, we can say that all the activities we do to earn a living are economic activities. All other activities are non-economic activities.

One way to identify economic activities is that they are driven by rationality and logic. The reason for performing such activities is for our own self-interest. We will gauge what returns we get in exchange for performing such activities. Non-economic activities, on the other hand, are done for emotional reasons or concern for another person. So all religious, charitable, social, patriotic, recreational

Answer 2

Firms and households are the sectors in a simple economy. Households are the owner of the factors of production (land,labour, capital,andentrepreneurship). Using this factors the firms produce goods and services. They reward the owner of the factors of production in the form of rent ,wages, interest and profit.

Households uses the factors of income (rent,wages,capital and entrepreneurship) to buy goods and services made by the firm, which constitutes as consumer expenditure. In return the firms give goods and services to the households.

Now,we can substantiate that there exists a interdependence between firm and households in production and consumption as well as there exists a interrelationship between these two sectors of economy. It is through this interrelationship the economy develops.