If inflows to the capital stock are greater than outflows, then:
A) Net investment is positive
B) Net investment is negative
C) Depreciation equals gross investment
D) Depreciation is greater than gross investment

Question

Quizplus · Accepted Answer

When inflows to the capital stock (such as investment in new equipment or infrastructure) are greater than outflows (such as depreciation and retirements), then net investment is positive. This means that the overall stock of capital is increasing, which can lead to higher productivity and economic growth in the long run.

If Inflows to the Capital Stock Are Greater Than Outflows