What is household, business, financial and government sectors?

Question

Participants of the Australian Economy, can't find a good definition anywhere.

Answer 1

It sounds like what you are referring to is The Circular Flow Model of Economic Interdependence. This model has five parts: Households, Businesses, the Product Market, the Resource Market, and Government.

The Household sector consists of consumers who supply the Product Market with monetary expenditures and the resource market with labor. In return they receive goods and services from the product market and monetary income from the resource market.

The Business sector interacts with the product market by supplying finished goods and services while receiving revenue in return and interacts with the resource market by supplying monetary expenditures through costs of production and receiving resources in return which it uses to make the finished goods it will supply to the product market.

In the middle is government which receives taxes from both Households and Businesses and supplies both with subsidies.

 

Realistically there are only three sectors (Households, Businesses, and Government) with the product market and resource market acting as hubs for the facilitation of trade between the sectors. As for the financial sector that seems more in line with the Business sector as a form of forecasting and investment decisions but would be considered more abstract since tangible goods and services are not generally made in such sectors. Their advice and decision making skills facilitate trade but do not consist of trade in and of themselves.