Because every transaction has a buyer and a seller,

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Since every transaction has a buyer and a seller, every transaction contributes equally to an economy's income and expenditure. This is illustrated in the simple circular-flow diagram where households provide factors of production to firms and receive payments for these factors in return. The firms then use these factors to produce goods and services which are sold to households, generating income for the firms. Thus, the income generated by firms is equal to the expenditure incurred by households in purchasing these goods and services.

Because Every Transaction Has a Buyer and a Seller