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Induced investment refers to the investment that is influenced by changes in the level of income in the economy. When income increases, induced investment also increases, and vice versa. On the other hand, autonomous investment is independent of changes in income and is determined by factors such as government policies, technological advancements, and business expectations. Autonomous investment does not vary with changes in income levels.

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5mo ago
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12y ago

Note that 'autonomous' means something you cant do wihtout.this kind of involves does not respond too changes in nocome level because it comes from a point of necessity e.g building of roads,govt hospitals,school etc.while induced investment responds to changes in income levels,,entreprenuers would prefer to invest more when there is abundance in availability of finance an vice versa.

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Q: What is the difference between induced and autonomous investment?
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Difference between autonomous and induced investment?

when an increase in investment is due to increase in current level of income and production, it is known as induced investment The autonomous invesment is generally associated with such factors as the introduction on new techniques or products, the development of new resources or the growth of population and labour force


What is difference between Autonomous Expenditure and Induced Expenditure?

AUTONOMOUS AND INDUCEDEXPENDITURE :Autonomous expenditure is independent ofchanges in real GDP, whereas induced expenditurevaries as real GDP changes. In general, a change inautonomous expenditure creates a change in realGDP, which in turn creates a change in inducedexpenditure. The induced changes are at the heartof the multiplier effect.Induced expenditure is the sum of the componentsof aggregate expenditure that change withGDP.♦ Autonomous expenditure is the sum of the componentsof aggregate expenditure that do notchange when real GDP changes.


What is induced investment?

Business investment expenditures that depend on income or production (especially national income or gross national product). An increase in national income triggers an increase in induced investment expenditures.


What is the difference between impressed voltage and induced voltage?

A: impressed voltage is a mechanical connection involved induced has no mechanical connection except for proximity


Interaction of multiplier and accelerator is called?

The interaction of multiplier and accelerator which bring change in gross national income. The components of theory are warranted growth rate, consumption function, autonomous investment, induced investment and multiplier accelerator relationship. The economy is growing at warranted growth rate when saving and investment are equal. The economic fluctuations around the warranted growth rate are due to working of multiplier and accelerator. The consumption is considered the function of income of the previous period. When consumption lags behind income, the multiplier is treated as lagged relation. Autonomous investment is free from changes in output level so it is not concerned with growth of economy. Induced investment has a link with changes in output so it is related with economic growth rate. The accelerator is based on induced investment. When investment level falls, the accelerator-multiplier works on the reverse direction. The price of contraction is slow as compared to expansion due to asymmetrical working accelerator. During expansion phase the limit to the expansion of real investment is set by production system capacity. In case of downturn the limit to disinvestment is set by depreciation. The businessman does not replace the worn-out machines. During slump multiplier work in reverse order and accelerator has limited role. Autonomous investment declines during slump but remains positive. The cyclical process is repeated in this way.


What are the four determinants of aggregate demand?

They are : desired spending, autonomous consumption,induced consumption and desired private consumption.


What is the difference between a spontaneous ovulator and an induced ovulator?

Spontaneous ovulator is like animals that ovulate out of nowhere. Induced ovulator is when animals ovulate because of/after mating like Llamas and cats.


What happens when metal rod moves in magnetic field?

Induced voltage generates in rod.Voltage difference evolve between two ends.


Induced angle of attack in simple terms?

it is the difference between local flow direction and free stream direction of atmospheric air


What is difference between induced voltage and induced current?

Just as a current flowing through a wire will produce a magnetic field, so a wire moving through a magnetic field will have a current flowing through it. This is called electromagnetic induction and the current in the wire is called induced current. A stationary wire in the presence of a changing magnetic field also has an induced current. A changing magnetic field can be produced either by moving a magnet near to the stationary wire or by using alternating current. A stationary wire in a magnetic field which is not changing will have no current induced in it. You will sometimes see this effect described as induced voltage. Strictly speaking, you will only get an induced current in the wire if it is part of a complete circuit. A wire which is unconnected at both ends will have a difference in voltage between the ends (a potential difference) but current can only flow when the wire is in a circuit. Induced current is used in electricity generation and transformers.Another AnswerThere is no such thing as an 'induced current', only an 'induced voltage'. Current will flow only if the conductor into which the voltage is induced forms part of a closed circuit.


Difference between back EMF and induced EMF?

An induced electromotive force (emf) is an induced voltage. Voltage (emf) causes current flow, and this induced voltage will cause a current that is called the induced current.We might also add that the induced current will cause a magnetic field to expand about the current path, and this field will "sweep" the conductor. The sweeping of the conductor by that expanding magnetic field will set up an emf that will oppose the emf that was creating it.CommentTechnically, there is no such thing as an 'induced current'. It is voltage that is induced. Any current flows as a result of that induced voltage being applied to a load. But that current is certainly NOT induced!


Difference between statically and dynamically induced emf?

STATICALLY INDUCED EMFThe emf induced in a coil due to change of flux linked with it (change of flux is by the increase or decrease in current) is called statically induced emf.Transformer is an example of statically induced emf. Here the windings are stationary,magnetic field is moving around the conductor and produces the emf.DYNAMICALLY INDUCED EMFThe emf induced in a coil due to relative motion of the conductor and the magnetic field is called dynamically induced emf.example:dc generator works on the principle of dynamically induced emf in the conductors which are housed in a revolving armature lying within magnetic field