If an economy's capital stock is greater at the end of the year than at the beginning of the year, over this period,
A) net investment has been positive.
B) depreciation has exceeded net investment.
C) depreciation has exceeded gross investment.
D) net investment has exceeded gross investment.

Question

Quizplus · Accepted Answer

Net investment is the difference between gross investment and depreciation. If the capital stock is greater at the end of the year than at the beginning, then gross investment has exceeded depreciation, which means net investment has been positive.

If an Economy's Capital Stock Is Greater at the End