Frequency Dependent Magnetic Susceptibility and the $q^2$ effective conductivity tensor

We apply a microscopic formalism for the calculation of material response properties to the problem of the generalization of a first-principles, i.e based on the energy spectrum and geometric properties of the Bloch functions, derivation of the AC magnetic susceptibility. We find that the AC susceptibility forms only a part of the $q^2$ -- where $q$ is the wavevector of the applied field -- effective conductivity tensor, and many additional response tensors characterizing both electric and magnetic multipole moments response to electromagnetic fields and their derivatives must be included to create the full gauge-invariant response. As was seen with the DC magnetic susceptibility and optical activity (characterized by the linear in $q$ contribution to the conductivity) one must be careful with the diagonal elements of the Berry connection. To our knowledge this is the only derivation of such a result general for crystalline insulators, with both `atomic like' contributions and `itinerant contributions' due to overlap of atomic orbitals and non-flat bands. Additionally, quantities familiar from quantum geometry like the Berry connection, curvature, and quantum metric appear extensively.