Question
Download Solution PDFNet Investment plus Depreciation gives an estimate of which of the following?
Answer (Detailed Solution Below)
Detailed Solution
Download Solution PDFThe correct answer is Gross investment
Key Points
- Gross investment:-
- It is the total expenditure on new capital goods during a period of time.
- It includes investment in both fixed assets, such as machinery and equipment, and inventory.
- Gross investment is an important component of economic growth, as it increases the productive capacity of the economy.
- Net Investment plus Depreciation gives an estimate of Gross investment.
- Gross investment can be divided into two categories: public investment and private investment.
- Public investment is an investment made by the government, such as on infrastructure projects.
- Private investment is investment made by businesses, such as on new factories and equipment.
Additional Information
- Personal income:-
- It is the total amount of money that an individual or household receives in a given period of time, typically a year.
- It includes all forms of income, such as wages, salaries, bonuses, commissions, investment income, rental income, and government benefits.
- Personal income is often used as a measure of an individual's or household's financial well-being.
- Gross domestic product:-
- GDP is the total monetary or market value of all the finished goods and services made within a country during a specific period.
- As a broad measure of overall domestic production, it functions as a comprehensive scorecard of a given country's economic health.
Last updated on Jul 19, 2025
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