Maharashtra State BoardHSC Commerce 12th Board Exam
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Write Short Note On: Circular Flow of National Income - Economics

Short Note

Write short note on:

Circular flow of national income

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Solution

There is a continuous flow of expenditure and income and that of goods and services in an economy. For example, households receive income from the firms. They, in turn, spend this income on the goods and services produced by the firms. Thus, the expenditure of the households becomes the income of the firms. Such a continuous flow of income and expenditure or the flow of goods and services among different sectors of the economy is called the circular flow of national income.

Concept: Concept of National Income
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APPEARS IN

Micheal Vaz Economics HSC 12th Standard Maharashtra State Board
Chapter 9 National Income
Exercise | Q 2.3 | Page 79
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