Explain the concept of the circular flow
What will be an ideal response?
The circular flow refers to the interrelationships between income and output. In every exchange the seller receives exactly what the buyer pays. This also means that someone's receipt is someone else's payment. Goods and services flow in one direction and money payments in the other. The total income received by people must equal the total spending of people. Businesses provide goods and services and sell them to households, and households provide the resources used by firms in exchange for income.
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The secondary supply of copper is:
A equally elastic in the short run and in the long run. B unit elastic in the short run and perfectly elastic in the long run. C more elastic in the short run than in the long run. D less elastic in the short run than in the long run.
Suppose we were analyzing the Turkish lira per euro foreign exchange market. If the Euro-Area's price level falls relative to Turkey and nothing else changes, then the:
a. The supply of euros in the foreign exchange market rises, and the demand for euros in the foreign exchange market falls, causing a depreciation of the euro. b. The supply of euros in the foreign exchange market falls, and the demand for euros in the foreign exchange market falls, causing an uncertain change in the value of the euro. c. The supply of euros in the foreign exchange market falls, and the demand for euros in the foreign exchange market rises, causing an appreciation of the euro. d. Neither supply nor demand in the foreign exchange market change because relative international prices influence trade flows and not the exchange rate. e. The supply of euros in the foreign exchange market rises, and the demand for euros in the foreign exchange market rises, causing an uncertain change in the value of the euro.