Economics (AS & A Level) · May / June 2025 · Paper 34 · Question 15
9708The circular flow of income
According to the accelerator theory, what would cause investment in an economy to be lower than in the previous year?
- Aa lower marginal propensity to consume than in the previous year
- Ba lower marginal propensity to save than in the previous year
- Ca smaller fall in national income than occurred in the previous year
- Da smaller rise in national income than occurred in the previous year
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Correct answer: D. a smaller rise in national income than occurred in the previous year
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