The Change in Capital Stock in a Period Is Equal

question 222

Multiple Choice

The change in capital stock in a period is equal to

• A) the ratio of the amount of the capital at the beginning of the period to the amount of depreciation.
• B) the amount of the capital stock at the beginning of the period plus gross investment minus depreciation.
• C) the amount of the capital at the beginning of the period plus gross investment.
• D) the amount of the capital at the beginning of the period minus net investment.

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Definitions:

Forward Buying

Purchasing inventory in larger quantities than immediately needed, often in anticipation of price increases or high demand periods.

Lot Size

The quantity of items that are produced, purchased, or moved in a single batch or order.

Cycle Inventory

Inventory that companies maintain to facilitate production in batches or cycles, as opposed to continuous production.

Quantity Discounts

Price reductions offered to customers purchasing in large volumes, incentivizing bulk purchases and often used to reduce inventory holding costs.