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Banking Term: Autonomous Investment

Find important banking term that is useful in upcoming banking exam.

Feb 28, 2015 12:16 IST

It is investment expenditure which is not induced by change in output. Examples of such investments are government expenditure infrastructure and firm’s expenditure on new plant to exploit an invitation.

According to the accelerator effect, the amount of investment is directly related to changes in the Gross Domestic Product (GDP) of a country.