Gross private domestic investment is all purchases of newly produced business capital goods and buildings

Question

Quizplus · Accepted Answer

Gross private domestic investment includes all expenditures on newly produced capital goods (both for business and residential construction) plus changes in business inventories. It accounts for investments in new capital, adjustments in inventory levels, and residential construction, but does not include purchases of capital goods produced in previous years to replace depreciated items, as those are considered replacement rather than new investment.

Gross Private Domestic Investment Is All Purchases of Newly Produced