Out of induced investment and autonomous investment, which one is influenced by the level of income?

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Solution

Autonomous investment refers to that investment which is independent of the level of income in the economy. It remains constant irrespective of the level of income in the economy. Induced investment refers to that investment which changes as the level of income changes in the economy. Therefore, Induced investment depends on the level of Income.

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Similar questions

Calculate Investment expenditure:

National income = 700

Autonomous consumption = 70

MPC = 0.8

Calculate equilibrium level of income from the following:

Consumption expenditure at zero level of income = 60

MPC = 0.9

Investment =100

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