Question

Define circular flow of income.

Answer 1

Answer:

Every year, we celebrate Guru Purnima to pay respect to all of the world's gurus or teachers and to express our gratitude towards them. By paying homage to his spiritual mentor Shrimad Rajchandra, Mahatma Gandhi resurrected the festival in India.

Explanation:

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Answer 2

Circular flow of income is the concept in economics which states that the income in an economy keeps on flowing from one person to another.

Explanation:

• Circular flow of income is a concept that establishes that the same money keeps on following from one person to another in an economy.
• In simple terms, new money is not created on a regular basis.
• In fact, the same money keeps on moving from one person to another.
• This can be understood in form of savings. The amount kept with banks in the name of savings is lent out to other people as loans. The loan amount is then used for other purposes and the money reaches the market again.