The process of circular flow of income and product in a four sector opens economy explained. An economy is normally a four sector Economy. In this economy there is another sector, called foreign trade or the trade with the rest of the world besides the other three sectors.
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Explain the process of circular flow of income and product in a three sector closed economy. The circular flow of income and expenditure refers to the process whereby the national income and expenditure of an economy flow in a circular manner continuously through time.