CAIE A-Level Economics 9.1.2 AD components & determinants
Practise identifying AD components and explaining how consumption, saving, investment and policy changes affect national income.
- Syllabus
- 2026–2028
- Course
- Economics 9708
- Level
- A2
Exam points
- explain the accelerator by linking changes in income growth to induced investment
- distinguish autonomous and induced consumption or saving from data and diagrams
- evaluate whether higher AD components risk inflation near full employment
9.1.2—AD components and determinants question 1
[Maximum number: 1]
According to the accelerator theory, what would cause investment in an economy to be lower than in the previous year?
A
a lower marginal propensity to consume than in the previous year
B
a lower marginal propensity to save than in the previous year
C
a smaller fall in national income than occurred in the previous year
D
a smaller rise in national income than occurred in the previous year
D
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