What this practice covers
These questions are drawn from past CIE 9708 papers and filtered to the circular flow, injections and withdrawals. You answer, you find out immediately whether you were right, and you get the reasoning for the correct option and for each distractor. Wrong answers go to a mistakes locker so you can come back to exactly those.
Practice is free. You need an account only so your progress and your mistakes are still there next time.
Start practising Paper 3 MCQs →
What examiners see students get wrong here
These are the errors that cost marks on the circular flow, injections and withdrawals, taken from our own topic notes. Read them before you practise and you will recognise the traps in the questions.
- Assuming saving must equal investment because both appear in the model. Planned saving and planned investment are decided by different agents and need not be equal; it is the adjustment of income that brings them into line.
- Treating equilibrium as full employment.
- Classifying a transfer payment as a government injection. Transfers are not spending on goods and services; they redistribute income and affect the flow through consumption instead.
- Forgetting that imports are a withdrawal and exports an injection, and reversing them.
- Confusing average and marginal propensities.
- Saying the adjustment happens through prices when the Keynesian mechanism is through output.
Revise it first
If any of the above is unfamiliar, work through the notes before practising: The Circular Flow, Injections and Withdrawals revision notes.