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Investments glossary

Circular Flow Model


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Quotes of the day:

A bad man, though raised to honour, always returns to his natural course, as a dog?s tail, though warmed by the fire and rubbed with oil, retains its form

— The Hitopadesa

The circular flow model demonstrates how money moves through society. Money flows from producers to workers as wages and flows back to producers as payment for products. In short, an economy is an endless circular flow of money.


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