Gross investment
A) is the purchase of new capital.
B) includes only replacement investment.
C) does not include additions to inventories.
D) Both answers A and B are correct.

Question

Quizplus · Accepted Answer

Gross investment refers to the total amount spent on purchasing new capital and also includes spending on replacing old or worn-out capital. It does not exclude additions to inventories; rather, it encompasses all forms of investment in capital assets.

Gross Investment