The round glide mannequin illustrates how in an economic system profits should equal production. In other words, one person's expenditure is another entity's income.
For example, Ben is a mechanic. He sells his services to Sandra. Sandra's expenditure is Ben's income.
The circular flow model is an economic mannequin that suggests the waft of cash via the economy. The most common shape of this mannequin shows the circular glide of profits between the household sector and the enterprise sector. Between the two are the product market and the aid market.
Businesses trade the revenue earned in the market for items and services to buy land, labor and capital in the market for resources.
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