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In a Simple Circular Flow Diagram,who Supplies Factors of Production

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Essay

In a simple circular flow diagram,who supplies factors of production in markets and who buys these factors of production? Who supplies goods and services in markets and who buys these goods and services?


Definitions:

Going into Debt

The state of owing money to another person or entity as a result of borrowing.

Financial Institution

An establishment that conducts financial transactions such as investments, loans, and deposits.

Equity Financing

The process of raising capital through the sale of shares in a company, providing investors with partial ownership.

Ownership Shares

Equity units in a company that represent a portion of the ownership, often conferring voting rights and a share in the profits.

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