Circular flow model of a simple economy with roles of firms

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Reference no: EM13692611

Draw the Circular Flow Model of a simple economy with the roles of firms, Households, Government and a foreign sector. In addition, identify the factor and product markets in this economy.

A) Identify in the diagram the flows for all injections and leakages in a typical year.

B) Discuss the economic functions of the players and the markets in your diagram. Explain the "Leakage" equation!

Reference no: EM13692611

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