CircularFlow

CircularFlow - Circular Flow Model The Circular Flow Model...

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Circular Flow Model Assumptions:  Four sectors or participants of every economy are: Households Firms Government , and  International  The ultimate owner of factors of Production,  Labor,  Land, and Capital  is households.   Households trade factors of production  (in resource  market)  with firms in exchange for income.   Households spend their income by buying goods and  services  (in the goods market)  form the firms.   If   Income = Spending , economy is in   equilibrium . The Circular Flow Model of the economy shows how  interactions among participants in an economy affects  the economy.
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Circular Flow Model
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This note was uploaded on 07/21/2009 for the course BUAD 350 taught by Professor Safarzadeh during the Summer '07 term at USC.

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CircularFlow - Circular Flow Model The Circular Flow Model...

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