How to calculate depreciation when,
Gross domestic capital formation=300
Net fixed capital formation=200,
Change in stock=50
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Answer:
Gross domestic capital formation is the summation of gross domestic fixed capital formation and change in stock.
i.e Gross domestic capital formation = Gross domestic fixed investment + change in stock
Therefore, we can conclude that as change in stock is already included in gross domestic capital formation, so it will not be added separately and depreciation is subtracted from GDP to get NDP.
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let me know if it help. if not then I'm sorry
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