I\'m having trouble understand how, in a private, closed economy (no government,

Question

I'm having trouble understand how, in a private, closed economy (no government, no exports or imports), income flows around the economy. People get their income and spend part of it, saving the other part of it in the banks (leakage). If households kept saving without spending any of their saved money, then the economy will eventually be deprived of money, right? So the banks then lend some of the money to businesses. Businesses use that money to invest (injection), which I guess means that they buy more capital/machinery from other firms, which will enable them to produce more the next year. But if households spend with the same MPC/MPS still, that means businesses will be getting the same amount of money from sales still, only now they are in debt. How would they pay off this debt if households don't draw from their savings? When I think about it, it seems the businesses would only get deeper and deeper in debt... which doesn't really happen in the real economy. Can somebody help me understand this please? Thanks!

Explanation / Answer

in a private, closed economy (no government, no exports orimports), income flows around the economy. People get their incomeand spend part of it, saving the other part of it in the banks(leakage). If households kept saving without spending any of theirsaved money, then the economy will eventually be deprived of money,right?
Yes but in a real economy people will spend theirsavings

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