MACROECONOMIC CIRCULAR FLOW MODEL
Credit - Prof. Kalyan Kolukuluri (with Google Gemini as TA)
Model:
2-Sector
3-Sector (+Gov & Fin)
4-Sector (+Intl Sector)
Flow Filter:
All Flows
Real Flows Only (Services/Goods)
Financial Flows Only (Money/Taxes)
Pause
Speed:
4-Sector Open Economy
Aggregate Demand / Output (Y)
Y = C + I + G + (X - M)
National Output equals total spending across Consumption, Investment, Government Purchases, and Net Exports.
Leakages & Injections Equilibrium
S + T + M = I + G + X + TR
Equilibrium holds when total economy Leakages (S + T + M) match total Injections (I + G + X + TR).
Disposable Income (Yd)
Yd = Y - T + TR
Income available to Households after paying Direct Taxes (T) to Government and receiving Transfers (TR).
Flow Legend
Financial / Monetary Flows (Solid)
Real Flows (Dashed Lines)