Why does depreciation decrease the stock of capital?
What will be an ideal response?
As capital stock items such as buildings and machinery become older, they wear out and become less productive. New investment is needed to replace these buildings and machinery that have depreciated or become obsolete.
Economics
You might also like to view...
Colonists supporting the American Revolution (1775–1781)
(a) were well-prepared and well-organized. (b) comprised at least two-thirds of the total colonial population. (c) faced lower transportation and communication costs than the British during the war. (d) were able to tax the colonists to finance the war.
Economics
Explain what a PAYGO rule is
What will be an ideal response?
Economics