Investment by ﬁrms in an economy is considered autonomous because _____.
A) investment decisions are not inﬂuenced by the current level of income
B) the level of investment depends on autonomous consumption
C) investment decisions depend on the level of inﬂation
D) the level of investment changes at different levels of output

Question

Quizplus · Accepted Answer

Investment by firms is considered autonomous because it is primarily determined by factors other than the current level of income, such as expectations about future profitability, technological innovations, and changes in interest rates. These decisions are made independently of the economy's current income level.

Investment by ﬁRms in an Economy Is Considered Autonomous Because