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Subjects

Economics

Gross investment and depreciation

सकल निवेश और मूल्यह्रास

In Class 12 Economics, this topic explains gross investment and depreciation within the chapter “National Income and Related Aggregates.” Students learn that gross investment includes spending on new capital goods as well as replacement of worn-out assets, while depreciation measures the loss in value of fixed capital through wear, tear and obsolescence. The topic clarifies the relationship between gross and net investment: Net Investment = Gross Investment − Depreciation. It also shows why depreciation is deducted when converting gross national income or domestic product measures into their net equivalents.

Practice questions

01 Which statement shows a correct advanced understanding of gross investment?

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02 Which statement shows a correct advanced understanding of net investment?

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