Class notes
STUDY GUIDE
- Course
- Institution
UNLOCKING THE POWER OF BEING A CRITICAL THINKER. EXPERIENCE THE DIFFRERENCE TODAY.
[Show more]
Seller
Follow
ngxizaprecious
Content preview
© VAN SCHAIK PUBLISHERSChapter 3:
Production,
income and
spending in the
mixed economy
, Chapter Outcomes
Once you have studied this chapter you should be able to
• describe how total production, total income and total spending in
the economy are related
• distinguish between stocks and flows
• describe the different sources of production and income
• Illustrate and distinguish between households and firms and
show how their decisions and activities are interrelated
• describe and illustrated the govt sector and how it interacts
with households and firms
• show how the foreign sector interacts with the domestic economy
• show how the financial sector fits into the overall picture
© VAN SCHAIK PUBLISHERS
,Relationship between production, income and
spending
We try and visualize how the economy fits together by looking at the
three major parts of the economy and how they are interrelated.
- Production creates income to those involved
in the production process and this income, in
turn, is spent to purchase the G&S created in
the production process (spending).
- Processes occur simultaneously in the
economy, creating a “circular flow” of
production, income and spending.
- Production, income and spending are all
flows.
- Stocks measured at a point in time
Flows measured over period of time
© VAN SCHAIK PUBLISHERS
, Production, income and spending
Figure 3-1 The three major flows in the economy (Textbook page 41)
Box 3-1 Stocks and flows (Textbook page 41)
© VAN SCHAIK PUBLISHERS
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller ngxizaprecious. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $7.32. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
48298 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 15 years now