Consumers decisions affect producers, and producer decisions affect consumers.
A circular flow model
A circular flow of influences
Individual goods
R
The free-market system has a circular flow of influences.
Consumers decisions affect producers, and producer decisions affect consumers.
A circular flow model
A circular flow of influences
Consumer decisions affect producers, and producer decisions affect consumers
Individual goods
R
Consumers and producers influence each other in a circular fashion.
They speed up the flow of capital and wages
Government is added into the circular flow model of a mixed economy.
Antitrust laws consumer-protection regulations
Antitrust laws consumer-protection regulations