Equilibrium in the Keynesian model requires that withdrawals be the same as
A) deposits.
B) debits.
C) credits.
D) injections.

Question

Quizplus · Accepted Answer

In the Keynesian model, withdrawals refer to the total amount of income that is not spent on domestic output, such as savings, taxes, and imports. Injections, on the other hand, refer to any additions to the circular flow of income and spending, such as investment, government spending, and exports. To achieve equilibrium, injections must be equal to withdrawals in the economy. Therefore, the correct answer is D) injections.

Equilibrium in the Keynesian Model Requires That Withdrawals Be the Same