Exports are an injection into the circular flow.

Question

Quizplus · Accepted Answer

Exports represent an injection of money into a country's economy, which increases the aggregate demand and overall output of the circular flow. This is because exports create revenue for domestic firms, which can then pay their employees, purchase inputs or invest in capital, and ultimately create more jobs and income. In contrast, imports represent a leakage from the economy, as they transfer money to foreign suppliers and reduce the domestic demand and production.

Exports Are an Injection into the Circular Flow