The circular flow shows that aggregate spending is than aggregate income because people save.

Name: The circular flow shows that aggregate spending is than aggregate income because people save.
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The circular flow shows that aggregate spending is equal to aggregate income, not less than or greater than. It is not accurate to say that people saving causes a decrease in aggregate spending or income, as saved money can later be used for spending or investment.

The Circular Flow Shows That Aggregate Spending Is Than Aggregate