Question

Distinguish between gross investment and net investment

Answer 1

Explanation:

hope it helps you

Answer 2

Answer:

Investment is critical to a country's economic development: it is the primary source of new jobs and the primary driver of economic expansion. The difference between both is as below:

Explanation:

• Gross investment is the total expense incurred to purchase capital goods or to add to capital stock over a time period, without counting depreciation. Net investment is the actual expenditure incurred to purchase capital goods over a time period, taking into account the effect of increase or depreciation in the capital stock.
• Gross investment is calculated by computing the total expenditure incurred on acquiring capital goods. Net investment is calculated by subtracting depreciation from gross investment.
• Does not consider depreciation to determine final value. Considers depreciation to determine final value.
• It gives an idea of ​​how much money is spent solely on capital goods. It takes into account factors like wear and tear to give an idea of ​​how much money is actually spent on capital goods. Hence it helps in improving the efficiency of the organization

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