In which option is expansion investment clearly shown?
Answer and explanation
Correct answer: Gross investment 130 and depreciation 80
Expansion investment is indicated by positive net investment. In option C, net investment equals 130 − 80 = ₹50 crore, so after replacing worn-out capital, ₹50 crore of additional productive capital is added. Option A gives zero net investment and only maintains capital, while B and D give negative net investment and indicate a falling capital stock.
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What is the correct answer to this question?
Gross investment 130 and depreciation 80
Why is this the correct answer?
Expansion investment is indicated by positive net investment. In option C, net investment equals 130 − 80 = ₹50 crore, so after replacing worn-out capital, ₹50 crore of additional productive capital is added. Option A gives zero net investment and only maintains capital, while B and D give negative net investment and indicate a falling capital stock.
Which subject and chapter does this question cover?
This is a Class 11 Economics question. Chapter: National Income and Related Aggregates.
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