#circular flow

[er-cryptid]

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[shahva]

Economics Short Definitions 81 to 90

Economics Short Definitions 81 to 90

81 Circular Flow

Circular Flow is the flow of money income

From businesses to individuals for the services of economic resources

From individuals to businesses for the purchase of the goods and services which were produced

82 Equilibrium Level of Output

Equilibrium Level of Output is the output level determined by the equating of aggregate demand and aggregate supply.

83 Inflationary…

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[doremifasolalala]

Once in a while my notes look nice. In the spirit of exam week(s) happening all over the world right now, here’s some study inspiration.

Elasticity

Circular flow

Free trade

Dead weight loss

Poverty trap

Development strategies

Market failure

Biochemistry

Good luck with your final stretch! You can do it! ~Gloria

Study Inspiration: IB Edition Once in a while my notes look nice. In the spirit of exam week(s) happening all over the world right now, here's some study inspiration. Good luck with your final stretch! You can do it! ~Gloria

[kitt-economics-blog]

The circular flow diagram illustrates the relationship between households and firms and how resources and money move among a market.

[misako-of-letters]

can i pay for college with my tears

The class of 2008 has not been quite as lucky as those who are born at the right place, at the right time, mainly because of the economy. Those who were born between 1980-1997 are distinctively the poorest generation. Why? That's because of the decreasing wages, low values in assets and, probably the biggest factor of them all, student debt. Without an optimistic job market, some undergraduates went on to continue their education, which increased their debt.

What could possibly decrease student debt? Obviously, the perfect solution would be lowering the cost of attendance. However logical and rational this idea may sound, the issue delves much deeper than that. Our government pays for our education, but when the economy is in peril, the money is directed wherever it's needed most, thus exacting higher investments from students and their families. The circular flow is a prime example of the domino effect; it's a chain reaction.

[lsosl]

Got bored so I drew this on my macro economics assignment

[linexline]

The Circular Flow of Money

If I have $100 to spare, and I am feeling like spending that $100 in one transaction, maybe I'll go out for sushi. 

That $100 toward sushi does a few things to the economy. I eat, drink and be merry. So do 3 others I've brought along. On the other side of the counter, there is a chef and a waitress working with us. Beyond that someone shipped everything to this establishment. It is a good sushi place, but not terribly close to a body of water, so the fish is flown in fresh every day.

Someone flew the fish to us, but it is a different skill set than those catching the fish. So now we've got people catching the fish.

My $100 helps perpetuate or create demand for more jobs like sushi chef, waitress, cargo pilot and fisherman. But where it gets interesting is the fact that each of those people involved in the transaction become benefactors of the demand and are then able to earn more money. 

That extra money, if conditions are right and the people holding it feel like spending it, creates more demand throughout the economy.

This is just a simple example, but $1 isn't just $1 to the economy.

But if that extra $100 isn't much to me, I may just tuck it away until the economy turns around, which doesn't help the economy turn around.