In the third quarter of 2008, investment in the U.S. totaled $1.4 trillion and in 2007, investment was $1.3 trillion. The change in investment
A) is a change in autonomous expenditure.
B) is a change in equilibrium expenditure.
C) is a change in induced expenditure.
D) will increase the multiplier.

Question

Quizplus · Accepted Answer

The change in investment from 2007 to 2008 represents a change in autonomous expenditure, as it is an initial change in spending that is not caused by changes in income or output levels.

In the Third Quarter of 2008, Investment in the U