The circular flow model of economics shows how money moves through an economy in a constant loop from producers to consumers and back again, factoring into a nation’s GDP.

In the study of economics, one learns the circular flow of the economy between firms and households. This post, however, presents another circular flow model based on capital and labor. (It is a ...

Learn the meaning of the terms "money flow" and "real flow." Find out how they relate to each other in the circular flow of income economic model.