AFL - Leakages and Injections

What is considered a leakage in the economy?

• Government spending
• Savings
• Investment
• Exports

Which of the following is an injection in the economy?

• Imports
• Taxes
• Government spending
• Consumer savings

When households save money, it is considered a:

• Leakage
• Injection
• Both leakage and injection
• Neither leakage nor injection

Government transfer payments are classified as:

• Leaks
• Injections
• Both leaks and injections
• Neither leaks nor injections

In the context of the circular flow of income, what does investment represent?

• Leakage
• Injection
• Both leakage and injection
• Neither leakage nor injection

If a country experiences a trade surplus, it means:

• Injections are greater than leakages
• Leaks are greater than injections
• Injections and leakages are equal
• None of the above

Which of the following is an example of an injection through international trade?

• Imports
• Exports
• Savings
• Taxes

When businesses retain earnings instead of distributing them as dividends, it is considered:

• A leakage
• An injection
• Both a leakage and an injection
• Neither a leakage nor an injection

If a government runs a budget surplus, it implies:

• Increased injections into the economy
• Increased leakages from the economy
• Balanced injections and leakages
• None of the above

What happens to the economy when leakages exceed injections?

• Economic expansion
• Economic contraction
• Economic stability
• No impact on the economy