This website is edit by the Elite Board of economics students of Bertharry English Private School. The Elite Board is under the supervision of Mr Calvin Mavondo. The Elite Board is made up of 4 members, namely kgahlisho Murwa, Shephard Dube(chairperson), Winnie Mbasasa and Lethabo Letsoalo. Our aim is to improve the understanding of economics theories world wide.
Wednesday, January 20, 2010
The circular flow
The circular flow is a simplified version of showing how the economy operates. They are two types of circular flows ,pitting the one excluding foreign sector which is for a closed economy and the one including foreign sector which is for a open economy. For an individual to understand economics he has to first master the circular flow. The circular flow shows that households are the back bone of the economy because they directly and indirectly own the factors of production.
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