Question 70
HardOriginal questionIn a three-sector economy (households, firms and government), which pair is an injection and a leakage, in that order?
Show the answer and explanation
CorrectNot quiteAnswer A
Correct answer: A
Explanation
Government spending adds demand for firms' output: an injection.
Taxes take income away from spending: a leakage.
- Concept
- The government in the circular flow
- Typical timeTypical
- 100 s
- Your timeYours
- —
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