Question

4. Capital formation indudes capital goods only.
Is this statement true or false? Give reason.​

Answer 1

Answer:

1)Capital formation refers to the net capital accumulation during an accounting period for a particular area.Thus 1st statement is true.

2)Savings is essential for capital formation as savings leads to investment in an economy which in turn leads to more capital formation.

Answer 2

Concept introduction:

Capital Formation is defined as the portion of a country's current output and acquisitions that is neither consumed or exported during the accounting period, but is instead set aside as an increase to its capital goods stock.

Explanation:

We have to say the statement  is true or false.

A statement is given to us.

4. Capital formation induces capital goods only.

The statement is True.

Savings is essential for capital formation as savings leads to investment in an economy which in turn leads to more capital formation.

Final answer:

Hence, the statement is True.

#SPJ2