Answer questions 1 to 3

Data Response Question Circular flow of income The figures in Table 1 represent the Table 1 Q only income payments received by Ebn households. There are no savings, Rent 5 1. Draw a circular flow of income investment, government expenditure Wages 75 diagram. Label it at the and taxes or foreign trade in Interest and profit 20 appropriate place with the value the economy. of: (i) income, (ii) output and (iii) expenditure 2. How would your answer be different if wages were E100 billion? 3. Now assume that there are injections into and withdrawals from the circular flow. Investment is E10 billion, goverment spending E20 billion and exports 630 billion. Savings are E15 billion and taxes are f15 billion. (i) What must be the equilibrium level of imports? (ii) Show these injections and withdrawals on your circular flow diagram