Question

If gross investment (Ig) is ₹80 lakh and replacement investment (Ir) is ₹20 lakh in a year, what is net investment (In)?

Options

• ₹20 lakh

• ₹40 lakh

• ₹60 lakh

• ₹100 lakh

Answer 1

₹60 lakh

Explanation:

Net investment is the part of gross investment that adds to capital stock, so In = Ig − Ir = 80 − 20 = 60 lakh.