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Leakage is an economic term that describes capital or income that escapes an economy or system in the context of a circular flow of income model In simpler terms, leakage occurs when money earned isn’t reinvested into the economy through consumption, investment, or government spending, potentially dampening aggregate demand and slowing economic growth. It results in a gap between supply and demand.

The meaning of leakage is the act or process or an instance of leaking The amount that is lost when something leaks How to use leakage in a sentence.

In other words, a leak is the source of the problem, while leakage is the result of that problem

Both terms are used to describe the unwanted escape of a substance, but leakage is more commonly used in a technical or scientific context. The act of leaking or the leak itself Making known secret information 3 Leakage is a term used in economics to describe the outflow or loss of income from a system or economy

It refers to the portion of income that is saved, taxed, or used to pay for imports, rather than being spent within the domestic economy. An occurrence in which something (such as a liquid or gas) passes through a hole in a surface

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