Question 54
HardOriginal questionIn a year, gross investment in an economy is ₹1,200 crore, of which ₹200 crore is an addition to inventories. Depreciation is ₹350 crore. Net fixed investment is
Show the answer and explanation
CorrectNot quiteAnswer B
Correct answer: B
Explanation
Gross fixed investment = 1,200 − 200 = ₹1,000 crore.
Net fixed investment = 1,000 − 350 = ₹650 crore. Depreciation applies to fixed capital.
Worth noting
₹850 crore is net investment including inventories; the question asks for fixed investment only.
- Concept
- Fixed and inventory investment
- Typical timeTypical
- 100 s
- Your timeYours
- —
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