THE CANADIAN ECONOMY: THE BIG PICTURE
After reading the resources, we could have a big picture of Canadian economy. But firstly
we need know what the role of the Canadian economy. 1. It produce goods and services; 2.
It trough production activities to create jobs; 3. Those jobs provides people opportunity to
earn income, with the income people could able to buy the product.
Canadian economy was composed of entrepreneurs who earning profits by producing
goods and services that people need. After that we could build the big picture from
householders. As we know, the resources needed in production was owned by privately,
people own them so they could earn an income by offer their resources. In factor markets,
people offer their resources like labor, land, natural and knowledge to entrepreneurs; and
entrepreneurs gives income to people like wages, rent and interest. In product markets,
householders buy the product they need from entrepreneurs, and entrepreneurs sell goods
and services to people to earn money. This is the basic picture that we made.
Due to we use money as the medium between exchange, we need add the financial
institutions into our picture. On the one hand based on our previous discussion,
householders earns money from entrepreneurs. And they could choose spend all of the
money, but also could save part of money. Beyond that householders could borrow money
from bank to buy the product they need. However, overall, householders save more than
they borrow, which means they have saving. People could save the money in bank to get
