When variable net exports are included in aggregate expenditures, the two leakages from the circular flow are
A)exports and saving
B)exports and consumption
C)exports and investment
D)imports and saving
E)imports and investment

Question

Quizplus · Accepted Answer

The two leakages from the circular flow when considering net exports are imports and saving. Imports represent spending on foreign goods, which is money leaving the economy, and saving is income not spent on domestic goods and services.

When Variable Net Exports Are Included in Aggregate Expenditures, the Two