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The Primary Purpose of the Circular Flow Model Is to Show

question 135

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The primary purpose of the circular flow model is to show how government policies affect businesses and households.


Definitions:

Debit Balance

A debit balance is the amount of money that a business or individual owes; it reflects transactions that have been debited to an account, increasing the total debit.

Board Of Directors

A group of individuals elected by shareholders to oversee the management and make major decisions for a corporation.

Corporate Registrar

A corporate registrar is an entity responsible for maintaining a company’s register of shareowners and managing share issues and transfers.

Mutual Agency

The legal principle that allows each partner in a partnership firm to represent and make decisions for the firm.

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