Which of the following is a leakage from the circular flow?
A)government purchases of goods and services
B)saving
C)transfer payments
D)exports
E)consumption expenditures

Question

Quizplus · Accepted Answer

Saving is a leakage from the circular flow because it represents income that is not spent on goods and services, and therefore, does not participate in the circular flow of income and expenditure. All the other options listed represent injections into the circular flow.

Which of the Following Is a Leakage from the Circular