506880
Description
Mind Map by 07nelvjose, updated more than 1 year ago
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Created by 07nelvjose
about 10 years ago
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Circular flow of income
- Increase in injections increase level of national income
- Investments are referred as injections
- Investments are referred as injections
- Withdrawals reduce the size of the national income
- Savings are referred as withdrawals
- Savings are income induced
- Meaning savings will increase as
income increase and vice versa if
income decreases
- Meaning savings will increase as
income increase and vice versa if
income decreases
- Savings are income induced
- Savings are referred as withdrawals
- If withdrawals and injections equal then
the economy is said to be in equilibrium
- If injections are not equal to withdrawals
then the economy is in disequilibrium
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