If the economy's capital stock increases over time,
A) gross investment equals depreciation.
B) net investment is positive.
C) depreciation exceeds gross investment.
D) depreciation is less than zero.

Question

Quizplus · Accepted Answer

Net investment is the difference between gross investment and depreciation. If the capital stock is increasing over time, it means that gross investment is greater than depreciation, resulting in a positive net investment.

If the Economy's Capital Stock Increases Over Time