Final answer:
A decline in investment will shift the AD curve to the left by a multiple of the change in investment, due to the multiplier effect on the economy.
Step-by-step explanation:
A decline in investment will cause the Aggregate Demand (AD) curve to shift to the left. This leftward shift of the AD curve signifies a reduction in aggregate demand, which can be due to factors such as higher interest rates, increased demand for imports over domestic products, or a general decrease in consumer and business confidence. The AD curve will not simply shift by the amount of decline in investment; rather, it will shift by a multiple of this change due to the multiplier effect in the economy. The movement to the left may lead to a decrease in the equilibrium quantity of output and the price level, potentially resulting in a recession if it falls below potential GDP.
To answer the student's question directly, the correct option is: A) left by a multiple of the change in investment. This reflects how components of aggregate demand, including investment, influence the position of the AD curve in the broader economy.