Question Details

The capital stock; net investment



A) The capital stock; net investment
B) The capital stock; depreciation
C) Depreciation; replacement investment
D) Net investment; depreciation
2) The difference between gross investment and net investment is
A) the capital stock.
B) depreciation.
C) the real interest rate.
D) equal to saving.
3) If depreciation is less than gross investment, then net investment is
A) positive.
B) negative.
C) zero.
D) This situation could never occur because it is impossible for depreciation to be less than
gross investment.

4) Net investment
A) equals gross investment plus depreciation.
B) is the only measure of investment used to calculate GDP.
C) equals gross investment minus depreciation.
D) is equivalent to the existing capital stock in the economy.
5) Net investment equals
A) gross investment + depreciation.
B) depreciation + addition to inventories.
C) savings - depreciation.
D) gross investment - depreciation.



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