Explain what each of its components mean and how that detailed model of “income” and “expenditures” providchoes a foundation for economic theory?

Devote approximately 600 words, or two to four paragraphs preparing your mini essay.  Accordingly, you are expected to draw on all assigned materials and course content to support your answers.

Mini essay A

Consider the “circular flow” diagram for our economy. Explain what each of its components mean and how that detailed model of “income” and “expenditures” providchoes a foundation for economic theory?