________ 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:

Income Tax Rate

The level at which a corporation or person's earnings are taxed.

Straight-Line Depreciation

A method of allocating an asset's cost evenly across its useful life.

Initial Investments

Initial investments refer to the upfront expenditures or capital put into a project or startup business, which may include costs for equipment, inventory, and facilities.

After-Tax Discount Rate

Reflects the rate of return on an investment after all taxes have been paid, useful for evaluating the real profitability of investments.