What is the circular flow of economic activity?

The flow of economic activity indicates the relationship between the economy of the organization and the current market. It also shows the money and goods circulation in the global market taking into account the household production which is sold to the business factor, then to the specific business organization, and finally to product market. Then the circle frames up when the household representatives buy specific services or items in the mentioned above product market. It is how the flow of economic activity works.

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If you google the diagram, you’ll see that there are additional factors included: revenue, costs, money income, consumption expenditures