The National Economy - The circular flow of income
10 important questions on The National Economy - The circular flow of income
What is aggregate demand (AD)?
What does AD consist of? Name the 4 parts?
In what way can a firm pay money to the household? Name 3.
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What can households supply? Name 2.
Why isn't the inner flow simple where Y = E?
Name 3 types of withdrawals (W)?
Name 3 types of injections (J)?
1. What is the consequence for banks when savings goes up?
2. What is the consequence when taxes increase?
3. What will happen when M increases?
What happens when the J are higher than W?
When J is bigger than W, there isn't an equilibrium. How does the natural mechanism work to restore this equilibrium?
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