Suppose that the capital stock initially is 1000,the depreciation rate is 0.06,and net growth of the capital stock is 120.This makes investment equal to

Name: Suppose that the capital stock initially is 1000,the depreciation rate is 0.06,and net growth of the capital stock is 120.This makes investment equal to
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Question

Quizplus · Accepted Answer

Investment equals the sum of net growth of the capital stock and depreciation. Depreciation is 0.06 * 1000 = 60. Therefore, investment = 120 (net growth) + 60 (depreciation) = 180.

Suppose That the Capital Stock Initially Is 1000,the Depreciation Rate