AUTONOMOUS VS INDUCED INVESTMENT MACRO ECONOMICS

·         AUTONOMOUS VS INDUCED INVESTMENT
MACRO ECONOMICS
MEANING OF INDUCED INVESTMENT

1. KEISER,” WHEN AN INCREASE IN INVESTMENT IS DUE AN INCREASE IN THE CURRENT LEVEL OF INCOME AND PRODUCTION.
2. INDUCED INVESTMENT IS THAT INVESTMENT WHICH IS GOVERNED BY INCOME AND AMOUNT OF PROFIT
3. IT IS INDUCED BY CHANGES IN INCOME AND PROFIT
4. IT INCREASES WITH INCREASE IN POSSIBILITY OF INCOME AND PROFIT AND VICE VERSA
5. IT IS PROFIT OR INCOME ELASTIC
6. PRIVATE INVESTMENT IS ANOTHER NAME OF INDUCED INVESTMENT

• DIAGRAM

   AUTONOMOUS INVESTMENT

1.       AUTONOMOUS INVESTMENT IS THAT INVESTMENT WHICH IS INDEPENDENT OF THE LEVEL OF INCOME OR OUTPUT

2.       NOT INDUCED BY INCOME

3.       IT IS NOT MADE ON THE BASIS OF CHANGES IN THE INCOME

4.       IT REFERS TO THAT INVESTMENT WHICH IS MADE WITH THE AIM OF INTRODUCING NEW TECHNIQUES,NEW INVENTIONS  FOR ENHANCING EFFECTIVE DEMAND IN DEPRESSED ECONOMY

5.       HICKS AND HARROD,” AUTONOMOUS INVESTMENT IS INFLUENCED BY SCIENTIFIC INVENTIONS AND RESEARCHES AND NOT BY PROSPECTIVE YIELD AND INCOME.”

   DIAGRAM