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On account of injections and withdrawals, equilibrium level of income undergoes :
A shift
No shift
A dispersal
No change
- The equilibrium level of income is determined where total injections (such as investments and government spending) equal total withdrawals (like savings and taxes) in the economy.
- Option 1: A shift
- This occurs when changes in injections and withdrawals lead to a new equilibrium income level. When there’s an increase in injections or a decrease in withdrawals, the equilibrium income level shifts upwards. Conversely, if injections decrease or withdrawals increase, the equilibrium shifts downwards.
- This is the correct answer.
- Option 2: No shift
- This would imply that injections and withdrawals are perfectly balanced, maintaining the existing equilibrium without change.
- Option 3: A dispersal
- This term is generally not used in the context of equilibrium income and might imply a spreading out rather than a shift.
- Option 4: No change
- Similar to option 2 but more about the static nature of the equilibrium.
By: santosh ProfileResourcesReport error
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