________ Increases the Quantity of Capital and ________ Decreases the Quantity

question 16

Multiple Choice

________ increases the quantity of capital and ________ decreases the quantity of capital.

• A) net investment; gross investment
• B) investment; depreciation
• C) depreciation; net investment
• D) investment; saving
• E) gross investment; net investment

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Definitions:

Inventory Accounts

Accounts used to track the costs of products purchased or produced for sale to customers until the products are sold.

Work in Process Inventory

Inventory that includes all the materials, labor, and overhead costs for products that are in the process of being manufactured but are not yet complete.

Direct Labor Costs

The cost of wages paid to workers directly involved in the production of goods or services.

Raw Materials

Basic materials that are used in the production process, which will be transformed into finished goods through manufacturing.