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2.2 How the macroeconomy works: the circular flow of income, aggregate demand/aggregate supply analysis and related concepts

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Question 40

Which one of the following explains the operation of the accelerator principle in an economy?

An increase in investment leads to a cumulative rise in national income.

High rates of inflation lead to a decrease in the level of planned investment.

A change in the rate of growth of national income leads to a change in the level of investment.

An increase in savings leads to a matching increase in capital investment.

2.2 How the macroeconomy works: the circular flow of income, aggregate demand/aggregate supply analysis and related concepts Questions

  1. A Level
  2. /Economics
  3. /2.2 How the macroeconomy works: the circular flow of income, aggregate demand/aggregate supply analysis and related concepts