Give the three categories which comprise gross investment and explain the differences among them
What will be an ideal response?
Gross investment includes (1) all final purchases of machinery, equipment, and tools by businesses; (2) all construction including residential; (3) changes in business inventories. The first group restates the definition of investment goods; the second item is houses and buildings that can yield an income return; the third group is “unconsumed output” and is therefore part of investment.
You might also like to view...
The slope of the budget line is equal to the ratio of:
a. marginal utilities. b. money income to the price of the good on the horizontal axis. c. money income to the price of the good on the vertical axis. d. price of the good on the horizontal axis to the price of the good on the vertical axis.
The industry demand for labor in a competitive labor market
a. is the same as the individual demand for labor in a perfectly competitive market b. is a horizontal curve at the market wage rate c. slopes upward when there are diminishing returns d. is the sum of the individual firms' demand curves for labor e. is downward sloping only if all firms that employ labor are identical