In National-Income Accounting,replacement Investment Is the Investment That

question 9

Multiple Choice

In national-income accounting,replacement investment is the investment that

• A)is used in the calculation of GDP from the expenditure side.
• B)maintains the existing capital stock at a constant level.
• C)is equal to all existing capital stock in the country.
• D)when added to gross investment is equal to total saving.
• E)is done by the government.

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Definitions:

Direct Labor-Hours

The total hours worked by employees who are directly involved in the production of goods.

Predetermined Overhead Rate

A rate used to apply manufacturing overhead to products or job orders, calculated before the period begins based on estimated costs and activities.

Variable Manufacturing Overhead

The portion of manufacturing overhead costs that vary with the level of production, such as utilities and materials.

Direct Labor-Hours

The cumulative hours employees spend directly participating in the manufacturing process.