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Circular Flow Diagram - Free Examples and Templates Download

> Basic Diagram Examples > Circular Flow Diagram - Free Examples and Templates Download
Posted by James Freeman | 12/23/2019
Draw Circular Flow Diagram easily from built-in examples and templates! Free Circular Flow Diagram Software Download

The following Circular Flow Diagram is included in our Circular Diagram Software. With the shapes, you can draw Circular Flow Diagram readily from built-in examples and templates! See how to create a circular chart from this video: Video Tutorial - How to Create a Circular Diagram

Circular Flow Diagram

Learn more about circular diagram software and view all examples

Circular Flow Diagram

piping and instrumentation example

What's a circular flow diagram?

The circular diagram (also called the circular model) is perhaps the easiest diagram of economics to understand. Even most children can understand its basic structure from personal experience. The circular diagram essentially displays the relationship of resources and money between firms and households. The basic circular diagram consists of two sectors that determine income, expenditure, and output: flows of physical things (goods or labor) and flows of money (what pays for physical things). A circular diagram depicts the inner workings of a market system and specific portions of the economy making it quite commonly used in a wide variety of presentations.

Why circular flow diagram is important?

1. It visualizes information in a clear and predetermined way and allows you to follow the flow of money through the system in economy.
2. The circle is considered to be the symbol of infinity and perfection. The circle has throughout history played an important role in art and aesthetics.
3. It provides a basis for organizing the wide array of macroeconomic indicators.
4. It helps one better understand the aggregate supply - aggregate demand model.

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EdrawMax is an advanced all-in-one diagramming tool for creating professional flowcharts, org charts, mind maps, network diagrams, UML diagrams, floor plans, electrical diagrams, science illustrations, and more. Just try it, you will love it!