Question

What is the addition to capital called?
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Answer 1

Answer:

Investment is the flow of additions to the capital stock during the period. The allowance for depreciation is often called replacement investment---the amount that must be added to the capital stock to replace the part that depreciated during the period.

Answer 2

Addition to the capital stock of an economy is termed as investment. Investment can be referred as a process of capital formation, or a process that increases the stock of capital during the year.

Formula: Investment= change in capital stock during the year.