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The multiplier and the accelerator

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Question 10

What does the multiplier effect show?

A

An initial increase in autonomous injection leads to a larger final increase in real GDP

B

An increase in the growth rate of national income leads to a more than proportionate rise in capital investment

C

Higher government spending financed by borrowing leads to a reduction in private sector investment

D

A rise in household wealth leads to an increase in the marginal propensity to import

Markscheme

The multiplier and the accelerator Questions

  1. A Level
  2. /Economics
  3. /The multiplier and the accelerator

22 exam-style questions on OCR A Level Economics The multiplier and the accelerator. Each one has a worked solution and a mark scheme showing where the marks go.

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