Draw the circular flow model of a simple economy

Reference no: EM13688038

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.

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

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

Reference no: EM13688038

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