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On the left is a circle containing the word ‘Households’ and on the right is a circle containing the word ‘Firms’. Underneath is a circle containing the word ‘Government’. There is an arrow labelled ‘Labour and consumption’ going from households to firms and an arrow labelled ‘Wages’ going from firms to households. There are arrows going from households and firms to government labelled ‘Taxes’ and arrows going from government to households and firms labelled ‘Government spending’. There is also a circle containing the words ‘Foreign sector’ with arrows going to it from firms labelled ‘Exports’ and ‘Imports’.

 1 Introducing inequality