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| What impact does the government have? |
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 | Do you know, what impact the government have? | |
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| Domestic producers benefit by ultimately facing reduced competition in their home market, which leads to lower supply levels and higher prices for consumersWhen a consumer does purchase a higher-priced imported good with a tariff imposed on it, the consumer now has less money to spend on other things.. | |
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| How does unemployment affect the circular flow model? |
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| How does unemployment affect the circular flow model? | |
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| Injections into the circular flow are additions to investment, government spending or exports so boosting the circular flow of income leading to a multiplied expansion of output. An economy is in equilibrium when the rate of injections = the rate of withdrawals from the circular flow. | |
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