In January 2014, Tim's Gyms, Inc. owned machines valued at $1 million. During the year, the market value of the machines fell by 30 percent. During 2011, Tim spent $200,000 on new machines. During 2014, Tim's gross investment was
A)$1 million.
B)$300,000.
C)$200,000
D)$900,000.
E)$100,000.

Question

Quizplus · Accepted Answer

Gross investment refers to the total amount spent on new capital, which in this case is $200,000 spent on new machines in 2014.