Principles of Economics, 7th Edition

Published by South-Western College
ISBN 10: 128516587X
ISBN 13: 978-1-28516-587-5

Chapter 2 - Part I - Thinking Like an Economist - Questions for Review: 5

Answer

The simplified circular flow of income model doesn't include the role for government or international trade.

Work Step by Step

The simplified model only looks at the private sector: the interaction between households and firms. Households provide labor, which the firms buy. In turn, firms provide goods and services, which households buy.
Update this answer!

You can help us out by revising, improving and updating this answer.

Update this answer

After you claim an answer you’ll have 24 hours to send in a draft. An editor will review the submission and either publish your submission or provide feedback.