Which of the Following Is a Leakages from the Circular

question 73

Multiple Choice

Which of the following is a leakages from the circular flow?

• A) Household saving and government spending
• B) Business investment and household saving
• C) Net taxes and household saving
• D) Government spending and business investment
• E) Net taxes and government spending

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Definitions:

Price Sensitive

Characteristic of information or news that could influence the price of securities if it were made public.

Zero-Coupon Bond

A type of bond that does not pay interest during its life but is sold at a discount from its face value and redeemed at par at maturity.

Immunization Strategies

Financial strategies used to shield a bond portfolio from the effects of interest rate fluctuations by balancing the duration of assets and liabilities.

Interest Rate Sensitivity

The degree to which the value of an investment, particularly fixed-income securities, changes in response to variations in interest rates.