Accelerator and multiplier stand for (A) the same thing and lead to an increase in output of the economy (B) the same thing and cause an increase in investment with increase in output (C) different things with the first causing a change in investment due to a change in output and the second causing a change in output due to a change in investment (D) different things with the first causing a change in output due to a change in investment and the second causing a change in investment due to a change in output

JNU SSS 2015 Question 15: Consumption and investment

Accelerator and multiplier stand for

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Consumption and investment has come up 74 times in 7 exams since 2005.

This question is on Marginal efficiency of capital and the accelerator, part of Consumption and investment in Macroeconomics.

How expected returns, interest rates and output growth drive investment.

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