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Economics (AS & A Level) · Oct / Nov 2023 · Paper 33 · Question 21

9708The circular flow of income

What, according to the accelerator principle, will cause the level of investment to fall?

  1. Aa decrease in confidence
  2. Ba decrease in the rate of growth of national income
  3. Can increase in the price of capital equipment
  4. Dan increase in the rate of interest

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Correct answer: B. a decrease in the rate of growth of national income

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