________ is the ratio of the total increment in equilibrium value of final goods output to the initial increment in autonomous expenditure of the economy.

Option 1 -> MPC is the ratio of change in consumption to change in income, not output to autonomous expenditure.

Option 2 -> The investment multiplier measures the ratio of total change in equilibrium output to the initial change in autonomous expenditure.

Option 3 -> Consumption multiplier is not the standard term for measuring impact of autonomous expenditure on output.

Option 4 -> MPS is the ratio of change in savings to change in income, not related to autonomous expenditure impact.

Hence, Investment multiplier -> The investment multiplier (k) is defined as k = ΔY/ΔA, where ΔY is the change in equilibrium output and ΔA is the change in autonomous expenditure. It shows how an initial injection of autonomous spending (like investment) leads to a multiplied effect on total output through successive rounds of income generation and spending. The formula is k = 1/(1-MPC) or 1/MPS, demonstrating that the final impact on output is always greater than the initial autonomous expenditure change. -> correct