What is the circular flow model?
1 answer:
In economics? The model refers to the flow of money and goods in a society.
In one direction, goods and services flow from firms (businesses) to households (consumers) and factors of production (labor) flow from households to businesses.
In the other direction, expenditures (cost of goods and services) flow from households to firms, and wages flow to households from firms.
In one direction, goods and services flow from firms (businesses) to households (consumers) and factors of production (labor) flow from households to businesses.
In the other direction, expenditures (cost of goods and services) flow from households to firms, and wages flow to households from firms.
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