To have a glimpse in the working of the economy as a whole may be of use to a student of economics.
In every economy there are lots of households to supply labour and capital to firms that use them to produce goods and services. Firms provide incomes for households, who in turn[15] use this money to purchase the goods and services produced by firms. This process is called the circular flow of payments[16].
The gross domestic product (GDP) is the total money value of all final goods produced in the domestic economy over a one-year period. The GDP can be measured in three ways: (a) the sum of the value added in the production within a year, (b) the sum of incomes received from producing the year's output, (c) the sum to spend on the year's domestic output of goods and services.
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