At the beginning of the year,Tom's Tubes had a capital stock of 5 tube-inflating machines.During the year,Tom scrapped 2 old machines and purchased 3 new machines.Tom's gross investment for the year totaled

Question

Quizplus · Accepted Answer

Tom scrapped 2 old machines and purchased 3 new machines, therefore there was a net increase of 1 machine (3 new machines - 2 scrapped machines = 1 net increase). Thus, the gross investment for the year is equal to the net increase, which is 1 machine. Therefore, the correct answer is choice C) 3 machines.

At the Beginning of the Year,Tom's Tubes Had a Capital