circular flow of income (11.1.1)

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  • Created by: lee42
  • Created on: 02-07-19 13:30
what does the circular flow of income show?
an illustration of the flow of money around an economy. Firms pay households for their factors of production (labour, land and capital) and households pay firms for goods and services. Income 'flows' in a circle.
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what are the withdrawls/leakages from circular flow of income
savings (s) and taxes (t) and Imports (m)
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what are the injections from circular flow of income
Exports (x) and investement (i) and goverment spending (g)
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what happens if injections exceed withdrawls?
the circular flow of inocme will expands and so will wil national output rise
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what happens if withdrawls exceed injection?
the circular flow of income will shrink and so will national income
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what if injections=withdrawls?
the national economy will be in equilibrium and there will be no tendency for change.
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Card 2

Front

what are the withdrawls/leakages from circular flow of income

Back

savings (s) and taxes (t) and Imports (m)

Card 3

Front

what are the injections from circular flow of income

Back

Preview of the front of card 3

Card 4

Front

what happens if injections exceed withdrawls?

Back

Preview of the front of card 4

Card 5

Front

what happens if withdrawls exceed injection?

Back

Preview of the front of card 5
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