« previous next »

Author Question: Define gross investment and net investment. Discuss the relationship between gross investment and ... (Read 87 times)

mcmcdaniel

  • Hero Member
  • *****
  • Posts: 550
on: Jun 29, 2018
Define gross investment and net investment. Discuss the relationship between gross investment and net investment.
 
  What will be an ideal response?

Question 2

Assume the inflation rate falls from 4 percent to 2 percent. This means that
 
  A) the price level has fallen.
  B) the price level is increasing more slowly.
  C) the economy is experiencing deflation.
  D) real GDP is decreasing.
Macroeconomics: Principles, Applications and Tools ¦ O'Sullivan, Sheffrin, Perez ¦ 7th Edition
Buy Test-Bank


zhanghao

  • Sr. Member
  • ****
  • Posts: 316
Reply #1 on: Jun 29, 2018
Answer to Question 1

Gross investment is the total amount spent on new capital goods to increase the quantity of capital and replace the depreciated capital. Net investment is the amount spent on new capital that exceeds the value of the depreciated capital or, in other words, net investment equals gross investment minus depreciation. Net investment is equal to the change in the capital stock.

Answer to Question 2

B


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

Allergies play a major part in the health of children. The most prevalent childhood allergies are milk, egg, soy, wheat, peanuts, tree nuts, and seafood.

Did you know?

The Romans did not use numerals to indicate fractions but instead used words to indicate parts of a whole.

Did you know?

Since 1988, the CDC has reported a 99% reduction in bacterial meningitis caused by Haemophilus influenzae, due to the introduction of the vaccine against it.

Did you know?

About 600,000 particles of skin are shed every hour by each human. If you live to age 70 years, you have shed 105 pounds of dead skin.

Did you know?

Medication errors are three times higher among children and infants than with adults.

The vagina, sagittal section showing the location of the vagina and its relationship to the cervix, The vagina, sagittal section showing the location of the vagina and its relationship to the cervix,
Milestones of Gross Motor Development in Infancy Age ranges provided are for 90% of American infant Milestones of Gross Motor Development in Infancy Age ranges provided are for 90% of American infant
When teenagers live in single-parent homes, a good relationship with grandparents is related to ... When teenagers live in single-parent homes, a good relationship with grandparents is related to ...
Relationship between Resource Use and Growth Relationship between Resource Use and Growth
The relationship between allelic frequency and genotypic frequency in a population that is in Hardy- The relationship between allelic frequency and genotypic frequency in a population that is in Hardy-
Relationship Between the Atlas and the Axis. The Dens of the Axis Provides a Pivotal Point Around Wh Relationship Between the Atlas and the Axis. The Dens of the Axis Provides a Pivotal Point Around Wh
Video: Properties of water -structure of water and polarity (Ionized and polar compounds)

For a complete list of videos, visit our video library