A government plans to raise its spending on defence. Half of this spending will be used for items such as planes and weapons, which it must import because these goods are not produced domestically. What is the immediate effect on injections and leakages from the circular flow of income?
- AThe initial rise in injections is greater than the initial rise in leakages.
- BThe initial rise in injections is greater than the initial fall in leakages.
- CThe initial rise in injections is smaller than the initial rise in leakages.
- DThe initial rise in injections is smaller than the initial fall in leakages.