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Define circular flow....

Define circular flow.

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Circular flow means the flow of money income and the flow of goods and services among different sectors of the economy.
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Knowledge Check

  • How many phases are there in circular flow of income?

    A
    2
    B
    3
    C
    6
    D
    5

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    What is the function of households in the circular flow ( two- sector model) ?

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    Imports create leakages in the circular flow of income. Do you agree ? How in your opinion the leakages can be corrected ?

    "Households and Firms depend on each other in the circular flow of income . " Justify the statement in case of a two - sector model.

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