Circular Flow

Money spent to benefit the public (parks, education, stimulus checks, welfare programs, highways, etc.)

Imports come from here, exports are sent here

The place where taxes are sent and public goods (education, parks, etc.) come from

What happens if Injections are greater than Leakages?

Where firms offer money in exchange for factors of production

Money given to the government from the CORE that funds government activities

This is money sent from the CORE to banks for security

Which of the following is an example of a Leakage?

Places where people live, they offer factors of production to firms in exchange for money

Land, Labor, Capital, and Entrepreneurship. Households offer these to firms in exchange for $$$

Which of the following is an example of an Injection?

What happens to our economy if Leakages are greater than Injections?

The place where the Core sends savings and receive loans

Where households purchase goods and services in exchange for money

Places people work, they offer $$$ in exchange for factors of production and sell finished products to households

Goods that are brought into our country from other countries

Goods that are sent out of our country into other countries

These are created by firms after they receive the factors of production. They sell these to households

Any money that is leaving the CORE to outside source

Any additional money that enters the CORE from outside sources

Money sent to the CORE from banks that increases the amount of money we have to spend, often on very expensive things