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Aggregate demand and aggregate supply

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Question 15

In the circular flow of income for an open economy with a government sector, economic activity is divided into the inner flow, injections, and withdrawals (leakages).

Which of the following options contains only withdrawals (leakages) from this circular flow?

Households buying groceries from domestic supermarkets; the government spending funds to construct a new state school; workers contributing a portion of their wages to private pension funds

Domestic firms purchasing newly manufactured machinery from local suppliers; households paying value-added tax (VAT) on domestic purchases; foreign residents purchasing domestically produced software licenses

Domestic households paying income tax to the government; residents booking and spending money on holidays abroad; businesses retaining undistributed profits in commercial bank accounts

The government distributing state pension payments to retired citizens; domestic manufacturers exporting automotive parts to overseas carmakers; domestic firms purchasing raw materials from international suppliers

Aggregate demand and aggregate supply Questions

  1. A Level
  2. /Economics
  3. /Aggregate demand and aggregate supply