How people produce (make money) and consume (spend money).
paying wages and consuming goods and services
producing and consuming
The circular flow of economic activity shows the interdependency of firm and household decision making.TrueFalse TRUE
Cached - SimilarYou +1'd this publicly. UndoIn economics, the terms circular flow of income or circular flow refer to a simple economic model which describes the reciprocal circulation of income
It doesn't. The economy will remain stagnent.
The circular flow of economic activity is a model showing the basic economic relationships within a market economy.
False
The circular flow of economic activity shows the interdependency of firm and household decision making.TrueFalse TRUE
Cached - SimilarYou +1'd this publicly. UndoIn economics, the terms circular flow of income or circular flow refer to a simple economic model which describes the reciprocal circulation of income
It doesn't. The economy will remain stagnent.
The circular flow of economic activity is a model showing the basic economic relationships within a market economy.
False
The market is the mechanism that brings together households and firms.
Free Enterprise
Counterclockwise and revenues flow counterclockwise.
The circular flow refers to a simple economic model which describes the reciprocal circulation of income between the consumers and producers. Thanks
[NovaNet] the movement of income from producers of goods and services to consumers, and back to producers. [Study Island] Consumer spending drives demand for goods and services.
The households like to allocate a part of their incomes for future uses. As a result the firms has to dispose all their goods and services that remain unsold. creating a disequilibrium to the flow of the economy.
Circular Flow of Economic Activity