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13 December, 11:40

A nation's capital stock was valued at $300 billion at the start of the year and $350 billion at the end. Consumption of private fixed capital in the year was $25 billion. Assuming stable prices, gross investment was?

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  1. 13 December, 13:14
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    Gross investment will be equal to $175 billion

    Explanation:

    We have given nation's capital stock at the start = $200 billion

    And capital stock at the end = $350 billion

    Consumption of private fixed capital in the year = $25 billion

    We have to find the gross investment

    Gross investment is equal to

    Gross investment = Capital stock at the end of the year + consumption of private fixed capital - Capital stock at the starting of the year

    = $350+$25-$200 = $175

    So gross investment will be equal to $175 billion
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