☰
✕

Non-Competitive Markets
Question
Wired Faculty App

What is the principle of circular flow of income and product?

Answer

(i) In exchange process, the seller (producer) receives the same amount which the buyer (consumer) spends.
(ii) Goods and services flow in one direction and the money payment to acquire them flow in the return direction giving rise to a circular flow.

Sponsor Area

Some More Questions From Non-Competitive Markets Chapter

Giving reasons categorise the following into stocks and flows:
(i) Losses (ii) Capital (iii) Production (iv) Wealth. 

Gross Investment and Net Investment

Domestic (Economic) Territory

National Income at Current and Constant Prices (Nominal and Real NI)

Consumption of Fixed Capital (Depreciation)

Factor Cost vs. Market Price (or Net Indirect Taxes)

Net Factor Income from Abroad (NFIA)

Value of Output vs. Value Added

Factor Payment (Income) vs. Transfer Payment (Income)   

 

Sources of Domestic Income