If net investment is negative, the capital stock has _______ ; if net investment is positive, the capital stock has _______ .

Question

Quizplus · Accepted Answer

Negative net investment means that the amount of investment in new capital goods (such as machinery or equipment) is less than the amount of depreciation of existing capital stock. This leads to a decrease in the overall capital stock. Positive net investment means that the amount of investment is greater than the amount of depreciation, leading to an increase in the overall capital stock.

If Net Investment Is Negative, the Capital Stock Has _______